AI can add flavour without leaving a bitter taste for investors

August 14, 2025

By Laura Morrison, Account Manager

Estimated read time: 6 minutes

It’s a rare occurrence that I will attend a Sunday roast – one of Britain’s most cherished traditions – without ordering cauliflower cheese for the table. Simple but indulgent, it’s a familiar side dish bringing warmth and nostalgia to any roast dinner. With eager anticipation on its arrival, we spoon a hearty portion onto our plates. But to our surprise, the intrepid chef has doused the cauliflower in truffle oil.

Adding a bold new ingredient to a well-loved dish poses the same challenges as adding a new tactic to your trusted ways of working. Done hastily, it can overwhelm the delicate balance, rattle the audience’s confidence, and leave everyone questioning the chef’s judgement.

For asset managers, AI is the truffle oil of the culinary landscape – increasingly becoming a staple ingredient which is hard to ignore. But like any burgeoning ‘secret sauce’, AI poses significant risks. And in an industry built on trust, how you communicate your use of AI matters almost as much as the technology itself.

Setting the table

There is little doubt that AI – both agentic and generative – is a disruptive innovation that will enhance asset managers’ day to day operations. And many are already viewing it as a recipe for success.

JP Morgan’s asset management arm has developed an in-house AI tool for its client advisers, resulting in an 95% increase in information-sourcing efficiency. Blackrock’s fundamental equity business no longer functions without its home-built AI research platform.

AI is already being used by the most agile companies to improve operational efficiency, enhance communications, and better protect against cyber-attacks. It is also taking on manual, labour intensive compliance processes, helping investment professionals make smarter decisions – and fast.

Stirring the pot

Despite its rapid developments, the sceptics remain prevalent. How likely is it that AI will actually drive better returns for asset managers’ clients?

Existing capabilities are far from flawless. There are still no good answers to who will police AI and what broader set of regulations will govern it. AI’s disruptive power is creating a skills gap between those who are early adopters and those who remain reluctant – one that is increasingly hard to close.

Only 41% of asset managers are actually in the implementation phase of AI, according to Citi’s latest research. And despite the majority of respondents believing AI will significantly impact investment processes, there are still major concerns around data quality, security and transparency.

This opaqueness is a worrying sentiment for asset managers’ stakeholders. Overhyping or underexplaining the use of AI can create an atmosphere of mistrust, particularly where stakeholders expect documentation, explainability, and accountability.

There is an opportunity, and need, for asset managers to own the brand narrative on their deployment of AI before we reach boiling point. A clear communications strategy won’t eliminate risk, but they can reduce confusion and fear if stakeholders can understand where AI is being used. For example, in portfolio building or risk management, and how it supports the firms’ investment strategy.

Regulators are also scrutinising the use of AI across financial markets, and if asset managers are hindering clear communication about the technology, they could be seen as attempting to circumvent necessary regulatory requirements. Proactively explaining the use of AI in a firm, including where it is used and how it is governed, can help meet evolving regulatory expectations – and offer much needed transparency.

Crème de la crème

The message is clear: if asset managers want their stakeholders to feel confident the introduction of AI will protect their investments and yield enhanced returns, be transparent in communicating this and how you plan to use AI. Straightforward ways to do so?

Map and disclose AI use cases clearly, providing regular bite-sized updates
Make it a two-way dialogue between you and your investors
Be transparent about limitations and risks and how you are meeting regulatory requirements
Show the human + AI partnership – reassure clients that AI is an assistant

Of course, crafting the right way to communicate AI strategies presents its own challenges. But recognising that clarity matters just as much with clients as it does with regulators is a crucial first step.

That transparency will better allow asset managers to demonstrate their credible reputation to stakeholders and put them in a better position to best embrace all types of innovation, AI included. Who knows, maybe we’ll conclude truffle oil was the missing ingredient all along.

About the author

Laura Morrison is an Account Manager in our Capital Markets team, based in London. She has been in the practice for over 4 years, leading PR execution to help our clients bring their AI stories to life. Drawing on her expertise in capital markets, regulatory landscapes, and technology trends Laura crafts compelling narratives that resonate with our clients’ target media.

Key takeaways

Why is AI adoption in asset management a communications challenge?

AI offers transformative potential but also introduces uncertainty, regulatory scrutiny, and mistrust if its role in investment processes isn’t clearly explained to stakeholders.

Why do asset managers need to communicate their AI strategies?

Overhyping AI without clarity risks damaging trust with investors, clients, and regulators. Proactive, transparent communication can bridge the gap between innovation and accountability.

How can asset managers communicate AI use effectively?

By detailing where AI is deployed, how it supports investment strategies, and how it’s governed, asset managers can build credibility, reassure stakeholders, and align with evolving regulatory expectations.