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The results of the CIO Sentiment Survey broken down into investment impact and themes

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Operations

In addition to investment strategy, respondents to the annual CIO Sentiment Survey also sound important changes in institutional investors’ operations, brought to life by the changed work patterns in 2020 as investors work remotely and take time to analyse existing processes and relationships.

The pandemic-induced shift to virtual communication is leaving marked changes on traditional in-person relationships. 2021 survey respondents expect external meetings, investment processes and governance to shift long-term to a hybrid model of virtual and in-person contact in the wake of the pandemic.

"53 per cent of 2021 respondents said they expected irregular touchpoints with external partners to now be virtual"

For example, 53 per cent of 2021 respondents said they expected irregular touchpoints with external partners to now be virtual. Only 50 per cent said they expected regular meetings to be in-person.

Elsewhere, most respondents expect the investment process - things like meetings around manager diligence or investment and performance monitoring - will now be a mixture of virtual and in-person meetings.

This hybrid trend stalls when the focus shifts to governance, however. Here the majority of 2021 respondents expect internal board meetings and internal planning meetings to be in-person.

The leap forward in technology use places even more emphasis on the extent to which asset owners’ have integrated technology in their investment operations and systems.

Today, technology around data analysis, machine learning and artificial intelligence is becoming increasingly embedded in the asset management sector. For example, an overwhelming 94 per cent of survey respondents from large and small schemes said they rely on technology to scenario plan while technology is similarly now essential in analysis and performance reporting.

Expected shift in working model

By % of respondent and function, 2021

External Meetings

Irregular touchpoints with external partners

Regular periodic touchpoints with external

RFP meetings

Irregular touchpoints with external partners

13%
35%
53%

Regular periodic touchpoints with external

5%
50%
45%

Regular periodic touchpoints with external

13%
50%
38%

Investment Process

Investment and performance monitoring

Manager diligence

Portfolio allocation and selection

Investment and performance monitoring

8%
53%
40%

Manager diligence

13%
53%
35%

Manager diligence

27%
43%
30%

Governance

Training

Internal planning meetings

Board meetings

Training

10%
51%
38%

Internal planning meetings

55%
25%
20%

Board meetings

55%
30%
15%

Events

Events

Board meetings

23%
53%
25%

key:

More Face-to-face
half & half
More vertual

Yet despite the pandemic accelerating digital trends and the shift to virtual communication, not all asset owners’ technology is up to speed.

Respondents reported how time-consuming technological glitches have weighed on productivity and success in recent months.

The survey found that asset owners that have invested in technology experience less friction overall in areas like employee personal time constraints (a key challenge of the pandemic) and in asset owners’ ability to achieve ambitious objectives. No surprise then that respondents said investing in technology around data analysis, new software/hardware and servicing, will be one of top two “primary” cost drivers in their operations going forward.

“Most asset owners weathered the pandemic with limited disruption, although technology investment played a role in reducing remote-work friction,” says Anthony Skriba, senior consultant at Casey Quirk.

"94 per cent said they rely on technology for scenario planning"

Today, technology around data analysis, machine learning and artificial intelligence is becoming increasingly embedded in the asset management sector. For example, an overwhelming 94 per cent of survey respondents from large and small schemes said they rely on technology to scenario plan while technology is similarly now essential in analysis and performance reporting.

Yet despite the pandemic accelerating digital trends and the shift to virtual communication, not all asset owners’ technology is up to speed.

Respondents reported how time-consuming technological glitches have weighed on productivity and success in recent months.

Future Use in technology

% of respondents

94%
3%
3%
88%
6%
6%
88%
6%
6%
Scenario
Planning
Anaylytics
Tools/Services
Performance Reporting / Attribution

key:

Yes - continuing to incorporate
No - Have reached desired end-state
No - not a priority

The survey found that asset owners that have invested in technology experience less friction overall in areas like employee personal time constraints (a key challenge of the pandemic) and in asset owners’ ability to achieve ambitious objectives. No surprise then that respondents said investing in technology around data analysis, new software/hardware and servicing, will be one of top two “primary” cost drivers in their operations going forward.

“Most asset owners weathered the pandemic with limited disruption, although technology investment played a role in reducing remote-work friction,” says Anthony Skriba, senior consultant at Casey Quirk.

See what investors are expecting from their external providers