Targeted at UK investment management firms and IA Engine innovators, 'IA talks AI' covers the implementation of artificial intelligence within the sector, from the perspective of both general business efficiencies and with investment-specific use cases in mind. Beginning in May 2023, the series contains short, informal interviews with industry leaders, policymakers, regulators and innovators, covering policy, regulatory and practical considerations.
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James King introduces the IA's work on artificial intelligence in the investment management industry, speaking with colleagues Gill Painter and John Allan at the Investment Association.
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Hello and welcome to this, the very first episode of the Investment Association's brand new podcast series exploring everything to do with artificial intelligence in the investment management industry. My name is James King and I'm a Senior Policy Advisor here at the IA and I'm delighted to be joined today by two colleagues. We have John Allan, the Head of Innovation and Operations here at the IA, and Gill Painter, the Head of Engine, that's the IA's Fintech hub and accelerator. Hi, James. Thank you. OK, excellent. Thank you both for being here. So we'll waste no time whatsoever. We'll get straight into it. And perhaps I can turn to you, John, with a rather basic question. What is AI and why is it important to the investment management industry?So artificial intelligence is essentially the the application of intelligence to wide-ranging data sets that would otherwise require the involvement of humans.And we see it as significant for society, for our firms as businesses, but more specifically to the investment management sector as it will be able to apply greater value to that data, extract real benefit for consumers and for firms in the future. There are a wide range of potential applications within investment management sector and that's probably really like to focus in on for this series. Fantastic. And Gill, if I could turn to you, could you tell us a bit more about Engine and your particular interest in AI and what you're doing with Fintechs? Thank you, James. Well, very excited to talk about engine. So Engine as you mentioned is the Investment Association's fintech hub and accelerator and what differentiates us from other hubs is the fact that we purely concentrate on innovation within asset and wealth management and it's very exciting times for AI as it covers every aspect of everyday life and with intech, is all about driving positive change and AI is very much at the heart of that and in a world which requires data and data- driven decision making, AI and the fintechs providing that solution are integral to the success of our sector. So we're utilising AI to transform decision making, to look at how portfolios are managed and to enable fintechs to access to engage and to share with our sector the opportunities that exist. And we're working with some really exciting firms and through Engine whether it's Blue Fire AI, a previous cohort member OrbitFin, causaLens, SESAMm, Clarity AI. Just a few that are operating within our ecosystem, but we have over 150 fintechs, most of which utilise a spects of AI. We have an industry panel made-up of 28 professionals of their organisations again are interested and utilising aspects of AI and we're now working with 12 international centres as well, so jurisdictions across the world that again are focusing on the Importance of AI and the impact on our sector.Brilliant. Thank you. You'll have to forgive me for asking this next question, but I suspect it's one that some of our listeners might be asking themselves. With all of the fantastic content that's out there at the moment looking at AI, why should listeners spend their time listening to this podcast series and what do they stand to gain that they might not necessarily get elsewhere?Sure, we'll we'll we'll be looking at the investment management specific aspects here. So we're going to get a a wide range of expert speakers who will have different perspectives whether they're from investment management firms, suppliers or operate within the ecosystem or the fintechs that that Gill's already outlined to look into the specific use cases of investment management, we'll also be looking at the regulatory developments that are happening at the moment, so that we are able to provide guidance and insight to firms on what the regulatory environment looks like now, but also would potentially look like in the future. And each one, each episode will focus on a specific actionable insight thatfirms can take away and apply back in their organisation.Fantastic. Gill, did you have anything to add to that? Just that I'm really excited about the opportunity for our solution providers and you know, the the chance to talk openly about the impact on ESG, consumer duty, financial crime and how AI is actively helping increase efficiencies and reduce the risks around those? Super. And John, if I can come back to you, what are some of the additional themes that we'll be looking to explore in upcoming episodes?There's a wide range that we'll be looking to do so both from the opportunity side but also the risk side because you know firms do need to bear that in mind. So from the opportunity side, we'll be exploring AI within the portfolio portfolio construction, investment management process, but also from a sort of client engagement and distribution angle and then looking more specifically at sort of back office operations and how it can be applied in in day-to-day work and then from the considerations and risks angle, building the work that you've done particularly on cyber security and resilience, of what the firms need to consider when they're looking at applying AI internally and then general risk practices and the compliance. Compliance, obviously, will be a moving target as the governments white paper and intentions that the Bank of England that the FCA will be taking forward. So we'll be also looking in particular at how that's going to develop over the coming years.Brilliant. And I mean from my point of view it's looking also at, you know, Keen that we also look at the legal liability aspects and bias and fairness and our solution providers have done a lot of work in that space alongside the compliance and the regulation and vendor management is key. You know organisations are looking to work more and more with third parties and these solutions provide again that real competitive advantage so addressing the vendor management and the RFP requirements is something that I'm really looking forward to. Fantastic. Well, it sounds like there's certainly a lot to get stuck into and for our listeners, I hope that's peaked your interest and you'll be interested in following along as we regularly release the episodes which you'll be able to access on the IA's website as well as on Spotify and iTunes I believe. So please do come along and listen to the next episodes. I'll finish just with a bit of a shamelessplug for our report that we published last year in conjunction with EY and Clifford Chance and this was a really practical report for firms titled 'AI in the I nvestment Management Industry'. And it explores current use cases that investment management firms are already deploying in the marketplace. But it also provides a bit of a guide for firms as to how to get going, exploring issues like governance, the AI lifecycle, legal and compliance issues. So it's still completely relevant today and we'll make sure that we provide alink to that report underneath wherever you're accessing this podcast from. So with that, thank you very much to Gill and John, and thank you for listening. I do hope you join us for the next episode.
