While artificial intelligence could threaten to replace fund managers' tasks in the future, the shift towards ESG and sustainable investing could keep their jobs alive.

Huge pension funds and sovereign wealth funds are already using computers and partnering artificial intelligence (AI) labs to observe and understand how their portfolio managers trade. Very soon, some of their jobs could be automated and replaced by artificial intelligence (AI). However, certain aspects of investing could still require human decisions.

«In a few years time, you have no reason to come into our office because we know how you guys are trading on a daily basis, why do we have to ask you to come in? But I think AI is important because AI will make sure that humans have to focus on something,» said Hiro Mizuno, Executive Managing Director at the Government Pension Investment Fund, Japan, who was speaking at the recent IMAS-Bloomberg event.

Future of Investment Roles?

As ESG involves some human judgment, people need to think about the kind of portfolios, the kind of society, and the type of industries they wish to support in the future. Those are the tasks that his team would not want Artificial Intelligence (AI) to do. 

«Before we start working on AI, there was a lot of skepticism within my team about ESG investing. Now, all the young (people) want to be involved, because they think that is one of the areas where they think human wisdom will prevail,» explains Mizuno. 

Differing Standards A Stumbling Block?

However, observers are quick to point out that different standards of measuring and reporting outcomes could present stumbling blocks to adopting ESG into investment processes. Anil Sinha, Global Liaison, South Asia, of The Global Impact Investing Network was selected to argue against the motion: «ESG has taken the world by storm and is now accepted as a serious investment trend and not a passing fad. Asia is poised to lead this sustainable revolution and leapfrog the world in ESG investing by 2025» during the conference.

«It is like an elephant to a blind man. If one looks at the financial reporting, there is a standard. For impact (investing), if you are looking for combined balance sheets, they need to be the same standard...and that is the challenge for us,» said Sinha. 

While acknowledging that greenwashing is still a big issue in all markets, Jeanne Stampe, Head of Asia Sustainable Finance Initiative (WWF), who was also at the event, pointed out that there are science-based targets in progress and taxonomy to help asset managers come up with standardized ways of reporting.