Do Wealth Managers Have the Tools to Confront Global Change?

January 2025

Global megatrends and shifting client expectations are giving rise to a new, interconnected system of personalization, transparency and technological forces requiring wealth managers to dramatically rethink how they deliver services. Learn how these forces are reshaping the industry — and how MSCI has built solutions designed to enable advisers to capitalize on emerging opportunities while mitigating risks — in our report with a survey of key stakeholders.

Four megatrends forging global change

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  Transformative technologies

  Artificial intelligence, blockchain and the Internet of Things are sweeping across most industries, changing how businesses operate and interact with their customers.

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  Environment and resources

  Climate change and sustainability are becoming a critical focus of governments, businesses and communities and, consequently, important to investors seeking to identify opportunities and manage risks.

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  Health and health care

  Advances in technology along with demographic shifts are profoundly impacting health and health care. An aging population in developed countries, for instance, is leading to higher demand for health-care services.

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  Society and lifestyle

  An expanding middle class in China, India and other emerging markets is boosting demand for consumer goods, financial services and real estate.¹ This new source of demand has the potential to affect trade patterns and investment flows.

What does this mean for your clients?

We believe these megatrends are giving birth to three broad trends capable of completely altering the wealth management industry:

Personalization: The new imperative

Personalization in wealth management was primarily reserved for select high-net-worth clients before technological advancements began to make it possible to efficiently scale solutions. Wealth managers can now more readily offer bespoke portfolios to a broader client base and clients now expect customized portfolios that reflect their unique financial goals, risk tolerance and values.

The exhibit below, based on the results of our survey sampling 220 wealth-industry professionals, including investment teams, portfolio managers and financial advisers,² indicates an industry-wide pivot toward personalization, with demand growing across client segments.

Exhibit 1: Investment preferences and tax optimization are top drivers of personalization

Source: MSCI survey, conducted in June 2024.

But managing and reporting against a standard model that has been customized to an individual client’s needs still poses many challenges to investment teams. Many wealth managers struggle to balance bespoke services with operational efficiency, particularly when scaling across a larger client base.

Transparency: The trust builder

Clients are no longer satisfied focusing only on financial returns; they want to ensure their portfolios are designed to align with their personal values. Transparency today involves analysis showing client investment preferences have been implemented as requested. It requires going beyond traditional investment information to provide greater visibility into what the client’s capital is funding in both public and private markets.

Exhibit 2, based on our survey results, indicates that wealth managers in the APAC and EMEA regions are significantly more focused on incorporating private assets into client portfolios than the U.S., amid an increasing client demand for diversified and non-traditional investments. Are wealth managers in the U.S. missing an opportunity by not adapting as quickly to this global trend?

Exhibit 2: Private assets drive greater interest in APAC and EMEA than in U.S.

Source: MSCI survey, conducted in June 2024.

Technology: The great enabler

Technology makes it possible to gather, analyze and act upon the vast market and portfolio data needed to deliver personalized services at scale. It equips advisers with new levels of transparency to dive deep into client portfolio compositions, performance metrics and impact assessments.

Here, our survey results below point to a significant barrier: Wealth managers recognize the potential of technology but find existing tools insufficient to meet client expectations. This dynamic creates a critical need for platforms that simplify operations, offer user-friendly interfaces and enable efficient integration across portfolio management processes.

Exhibit 3: Mobile capability and private-market analysis technology deemed inadequate by many advisers

Source: MSCI survey, conducted in June 2024.

MSCI Wealth: Meeting the modern needs of wealth managers

MSCI Wealth delivers an array of data, analytics, indexes and tools built to address these key trends reshaping the industry.

MSCI Wealth helps financial advisors, portfolio managers and investment teams prepare for the next frontier in wealth management:

• Deliver personalized services at scale
• Provide new levels of transparency to clients
• Confidently make data-driven decisions
• Efficiently manage diverse asset classes, including private investments
• Stay on top of regulatory change and emerging risks

• ¹ “The future of the middle class in emerging markets,” Oxford Economics, Oct 2024; ‘Emerging markets could hold the key to growth in the face of macroeconomic storms’, World Economic Forum, Jan 4^th, 2023.
• ² The survey, conducted in June 2024, reflects opinions of the professionals themselves, not their clients, although the opinions of financial advisers may be strongly influenced by past conversations with clients. Half the respondents were based in the U.S., with about a quarter each in the EMEA and APAC regions.