Most fiduciary managers are using artificial intelligence, but adoption remains focused on lower-risk operational tasks rather than core investment decision-making, according to research from Isio.
The consultancy found that 85 per cent of fiduciary management firms are now using AI, primarily to drive efficiency in back-office processes. The most common use cases include drafting internal documents and summarising commentary (91 per cent), reviewing legal documents (73 per cent) and coding (64 per cent). Just 9 per cent of managers using AI said it is currently deployed for trading client assets.
Isio says current levels of adoption reflect the early stage of many firms’ AI strategies. Fewer than a quarter (23 per cent) of fiduciary managers have a detailed AI strategy in place, while 62 per cent have early-stage plans to integrate AI more widely into their operations. However, 8 per cent reported having no AI strategy and no plans to develop one.
While fiduciary managers are not yet using AI to make independent trading decisions, Isio notes that some underlying funds may already be doing so, particularly in areas such as quantitative and high-frequency trading.
Looking ahead, the consultancy believes AI has the potential to play a greater role in areas such as stock selection and fund selection, where fiduciary managers hold extensive datasets across a wide universe of funds. Portfolio construction, however, remains the area furthest from effective AI application.
Anthony Webb, head of fiduciary clients at Isio, says: “We are seeing fiduciary managers enthusiastically adopt AI, but for now this is largely about augmenting existing processes to improve efficiency, with client benefits mainly coming through cost savings.
“We are approaching a stage where new AI capabilities could change how decisions are made, drawing on much broader datasets. However, while AI will be transformative over time, there are fundamental limits to what it can achieve in investment markets.”