Administrative service providers Intertrust have surveyed over 500 asset management professionals and found that 53 per cent predict a surge in demand for board-level chief technology officers (CTOs) in the sector over the next five years as the challenge to find senior talent to leverage disruptive technology increases.
The biggest skills gaps are in AI, regtech and compliance with 38 per cent of firms struggling to keep up with latest tech innovations.
Only 18 per cent of wealth managers believe that by 2023 most firms in their sector will have hired CTOs with a mandate to drive strategic change, particularly by harnessing the benefits of technologies such as artificial intelligence (AI), blockchain and robotics. A further third (35 per cent) expect that a minority of firms will have done so.
The study highlighted the growing challenges faced by organisations exposed to a technology skills gap; four in ten (38 per cent) wealth managers admitted that just keeping up to date with the latest technology innovations was a challenge. The biggest skills shortages are in regtech and compliance (45 per cent), followed by artificial intelligence (35 per cent) and cyber security (30 per cent).
Despite their predictions, the study revealed a lack of urgency to secure senior level talent; only 16 per cent of wealth managers said their firm is currently recruiting for a CTO-level role and upskilling existing staff to capitalise on emerging technologies. A further half (49 per cent) said their firm doesn’t currently recognise the need to recruit technology leaders or invest in new training. 13 per cent said that their organisations were finding it challenging to recruit tech talent, highlighting the difficulties in attracting candidates with the appropriate skill sets.
Ian Rumens, Head of Private Wealth, Intertrust says: “There is little doubt that we will see more CTOs emerge within wealth management with a clear mandate to drive transformational change. With many firms struggling to keep up with the latest developments in emerging technologies let alone seek a competitive advantage, the question will increasingly become when, rather than whether, to make new senior hires to devise the right strategy and implementation programme.
“Firms delaying their investment in appointing new CTOs with influence at the top table, or not doing so at all, risk losing out on the best candidates and falling behind their peers. Given the competition for technology leaders from other sectors outside financial services as well as their own, the necessary skills, particularly in high-demand areas such as AI, regtech and compliance are not always in ready supply. With the gulf in performance between digital leaders and laggards growing rapidly, firms can’t afford to be too complacent about their place in the technology revolution.”