AI will underpin human relationships in investment management not erode them

Aviva Investors' Fraser Lundie says the most dramatic implication of AI is the widening of the types of people that will succeed in investment management, while relationships become even more important

Since the 1990s, and like most industries, investment management has been shaped by technology, and the changes brought about by artificial intelligence are no different.

Whether its investment processes, recruitment, content creation or research and analysis AI is fundamentally reshaping how investment firms operate. With this comes a number of challenges to a company’s culture, team morale and the type of personalities investment management is attracting – the skills that matter most are changing.

But, speaking to ACT Insights, Fraser Lundie, global head of fixed income at Aviva Investors and a previous mentor on City Hive's mentoring programme, argues that AI should be viewed as a catalyst for positive change - provided firms think carefully about talent, collaboration and human judgement.

The end of the maths-only era?

One of the most dramatic implications of AI is that it could dramatically widen the type of people who succeed in investment management.

Historically, the industry has recruited from a relatively narrow talent pool - individuals with strong quantitative skills, economics degrees and highly analytical backgrounds. Lundie says that may no longer be necessary.

"The type of young person that you possibly need going forward is not quite as constrained as it used to be," he says.

"It used to be you basically had to be good at numbers."

Drawing on personality assessments conducted within Aviva, Lundie notes that many investment teams are heavily weighted towards detail-oriented, analytical personalities.

"95% of the room were blue - slightly introverted, attention-to-detail, perfectionist maths geeks," he says. "That can't be that healthy trying to get a holistic view on the world."

AI is likely to change that: "If AI is your maths wizard, it's more about how you interpret rather than how you actually calculate."

That opens the door for a broader range of thinkers - visionary personalities who may previously have struggled to navigate traditional graduate recruitment processes, but who bring creativity, communication skills and different perspectives.

For an industry that has spent years discussing how we can improve diversity of thought, AI could unexpectedly become one of its biggest enablers.

A new challenge for talent development

Yet if junior employees increasingly rely on AI to summarise documents, analyse data and automate research, how do they develop the judgement and instincts that experienced investors have accumulated over decades?

Lundie believes experience remains irreplaceable.

"It can't replace experience, and it can't replace some of the more intangible signs," he says.

He points to the behavioural and psychological insights that seasoned investors develop over time.

A model may accurately reflect management guidance. An experienced investor may recognise that the guidance is likely to change again. A spreadsheet may show improving numbers. A senior investor may spot a new chief executive "kitchen sinking" results to reset expectations.

These are not data points, they are human observations built through experience, and as a result, mentoring, coaching and knowledge transfer may become more important rather than less. The skills being taught may change, but the need for apprenticeship-style learning remains.

From data gathering to decision making

Lundie describes a world where AI is already dramatically reducing time spent on routine analysis.

Historically, analysts could spend most of their week gathering information, building models and processing historical data before reaching the stage where they could think about future outcome, but today much of that work can be automated.

"That 80% of your previous work life is gone, which means that the 20% can become 80%," he says.

Instead of spending days collecting information, analysts can spend more time asking better questions, challenging assumptions and engaging with company management teams. The result is not simply greater efficiency, it potentially creates better investors.

"It's more time for forward-looking decision making," Lundie explains.

This may prove one of AI's most important contributions to investment management - not replacing human decision makers, but giving them more time to think.

Relationships aren't disappearing - they're becoming more important

Another surprising outcoming, amid fear often raised about AI is that it will erode the human relationships that underpin investment management, is that the opposite will happen. Relationships, trust and authenticity become more important.

"There is going to be less room to hide," Lundie says. "The ability to deviate between your philosophy and your approach to your portfolio to the attribution of your performance - if there's holes in that chain, they're wide open for everyone to see now."

Trust therefore becomes even more valuable, relationships will still matter, but they must increasingly be built on transparency, authenticity and evidence rather than reputation alone.

Why culture matters more than ever

Perhaps the most important cultural implication of AI is that it reinforces the shift away from the "star manager" model, a trend we have seen over the last decade or so. Investment management has become too complex for any single individual to master every aspect of the process, and succession planning is not a keep part of fund firm’s operational models.

For these reasons, Lundie argues that investors are increasingly buying teams rather than individuals.

"I don't think the days of buying a particular fund manager are here anymore," he says.

Instead, success depends on how effectively people collaborate, share information, challenge one another and combine expertise.

"People are no longer buying the person. They're buying the full value proposition."

This brings culture firmly into focus. As AI reshapes workflows and alters job roles, firms that foster collaboration, learning, psychological safety and diversity of thought are likely to be best positioned to benefit.

In other words, the future of investment management may be powered by AI, but it will still be defined by people.