Global asset managers face growing pressure to transform their business models or risk falling behind in a sector where client expectations are being profoundly redefined. This is the warning from the study “An Expanding Mandate: A Systems Level Framework for Asset Management,” jointly produced by WTW’s Thinking Ahead Institute (TAI) and the CAIA Association. The report argues that traditional approaches, focused exclusively on returns relative to a benchmark index, are losing relevance in an environment increasingly shaped by interconnected risks, structural shifts, and rising client demands.
The research highlights a widening gap between firms adapting to this new reality and those continuing to operate under legacy frameworks. The report calls this new approach “systems-level investing,” a model that recognizes that long-term investment outcomes depend on the health and resilience of the broader economic, social, and environmental systems in which markets operate.
While firms generally acknowledge the importance of major structural themes such as geopolitics, artificial intelligence, or the convergence between public and private markets, the research indicates that many are not yet able to respond to them in an integrated manner—a capability that will be decisive for future success.
In contrast, some large asset owners—including sovereign wealth funds and pension plans—are adopting increasingly integrated approaches, with a greater emphasis on real-world outcomes and long-term resilience, and they expect the same from the asset managers they appoint.
The study also reveals that, despite intense industry rhetoric surrounding artificial intelligence, asset managers are not investing in AI at the pace public perception suggests. Five-year projections show that firms intend to keep human capital investment at the forefront, while technology spending increases only marginally. This finding underscores the need to balance the push for AI with other priorities such as talent, governance, and decision-making.
A Return to the Traditional Model
In this landscape, the portfolio management sector is undergoing strategic repositioning and accelerated consolidation. Although these trends stem from multiple factors, firms slower to evolve their capabilities and business models could find themselves more exposed to these pressures as client expectations continue to shift.
Therefore, the Thinking Ahead Institute and CAIA Association urge leaders in the asset management industry to rethink how success is defined within their organizations, strengthen their ability to make decisions in a more interconnected environment, and develop the talent and cultures necessary to operate effectively in a more complex world.
“Asset management is running out of room to maneuver with traditional approaches. In a world defined by interconnected risks, structural changes, and growing client demand, benchmark-only thinking is no longer enough. Firms need to adopt a more integrated, systemic view to remain relevant,” notes Marisa Hall, Director of the Thinking Ahead Institute.
In the view of Brenda Szymanowski, Investments Director at WTW Spain, many asset managers remain attached to models built for a simpler context. “The reality, uncomfortable as it may be, is that relevance is already being quietly but decisively redistributed by asset owners toward those who have transformed their organizations for this new reality,” she comments.
Finally, for John Bowman, CEO of CAIA, the era of training in technical skills within investment management has definitively given way to lateral and cross-disciplinary thinking. “Geopolitical fragmentation, technological disruption, demographic shifts, and the growing convergence between public and private markets demand a broader view, capable of connecting dots across different disciplines. This report highlights why systems thinking is becoming a strategic necessity for investment organizations seeking to stay relevant, resilient, and aligned with the evolving needs of asset owners,” he maintains.
