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Money Management

Milken conference tackles issues, opportunities for technology in asset management

Ron Mock, president and chief executive officer of Ontario Teachers’ Pension Plan

Technology and its use in asset management — and the issues and investment opportunities it is creating for money management firms — was an important topic for industry leaders speaking this week at the Milken Institute Global Conference in Beverly Hills, Calif.

The opportunities and challenges for money managers as they deal with the increased use of artificial intelligence, machine learning and blockchain came up on several panels.

But the challenges in recruiting, hiring and retaining the data scientists and technologists needed to take advantage of those opportunities was also on the minds of top money managers and pension fund executives.

Ron Mock, president and CEO of the C$189.5 billion ($147.6 billion) Ontario Teachers' Pension Plan, Toronto, said aging demographics — where the number of people under age 20 is smaller than those over 60 — in Canada create significant staffing challenges.

"We are looking at the next decade of talent acquisition (and asking) how do we compete to get the same type of tech talent (as the technology firms?) In the next two to five years, this issue is clearly going to come to some kind of a crunch," Mr. Mock said.

Nobel Gulati, CEO of systematic investment manager Two Sigma Investments, said the mission of managing money for people's retirement and for other long-term investors could be useful in the recruiting process.

"The world's best scientists and engineers are looking for more than (compensation)," Mr. Gulati said.

Ronald P. O'Hanley, president and chief operating officer of State Street Corp. (STT), agreed that the way to attract talent, and distinguish asset management from other industries, is mission.

While David Hunt, president and CEO of PGIM, said that in recent years the asset management industry has benefited greatly from the downsizing on the sell side of the capital markets, he is not clear how long that will continue to be the case.

Mr. O'Hanley also said the issue of talent acquisition has gotten more complicated as the "diversity of talent that we need is much different than it was years ago."

Particularly for people with tech skills, the supply of candidates is global, Mr. O'Hanley said, noting that his firm has people working on technology teams in China, Poland and India.

"You don't need to be limited to the U.S. We've got an immigration issue, but the talent is there."