Trust, Complexity, and What Asset Owners Owe Their Beneficiaries

Reflections from Milan

I recently had the opportunity to speak in Milan at a conference that brought together asset owners and industry participants to discuss a world that feels increasingly harder to map in simple terms.

What stayed with me most was not a single market view or portfolio call. It was a more basic question, and in some ways a more difficult one: what does it mean to earn the trust of beneficiaries who rely on us completely, while often understanding very little of what we actually do on their behalf?

That question feels especially important now.

We are operating in a world shaped by geopolitical fragmentation, new centres of capital, more porous boundaries between public and private markets, changing product structures, and the growing influence of data, technology, and artificial intelligence. It is easy to describe this as complexity. But complexity, on its own, is not the point. The real question is how institutions respond to it without losing sight of their mandate.

For me, trust begins there.

It begins with understanding that institutional investing is not ultimately about having the most sophisticated vocabulary, the most complex models, or the most elegant explanations after the fact. It is about stewardship. Beneficiaries do not need us to sound impressive. They need us to exercise judgment, remain disciplined as the environment changes, and make decisions faithful to the purpose of capital.

That sounds obvious, but in practice, it is harder than it should be.

In periods like this, it is tempting for institutions to become overly reactive to headlines, overly dependent on conventional benchmarks, or overly impressed by whatever the market currently rewards. But mandate-driven investing requires a different kind of discipline. It requires the ability to distinguish between noise and structural change, between short-term market moves and genuine shifts in the investable world, and between activity and actual decision quality.

One of the themes I kept coming back to in Milan was that the world is not simply becoming more volatile. It is becoming more rewired.

The geopolitical relationships that shaped the last few decades can no longer be taken for granted. Capital is moving through new channels. Supply chains, industrial policy, defence priorities, energy security, and technology controls are all influencing economic outcomes in ways that do not fit neatly into older portfolio templates. For global asset owners, that matters not only because it affects returns but also because it affects the assumptions underlying diversification, liquidity, inflation, and long-term risk.

This is where trust and portfolio construction meet.

To me, earning trust means being willing to look beyond market conventions as the world itself changes. It means asking whether the benchmark still reflects the mandate. It means taking scenario analysis seriously, not as a compliance exercise, but as a way to think about how external forces can reshape the path of the portfolio. It means recognising that liquidity matters more when the world becomes less stable, that governance matters more when decisions need to be made under pressure, and that clarity of purpose matters more when signals become noisier.

Another theme in Milan was the increasing convergence of public and private markets and the redesign of product architecture around that reality.

There is a tendency to discuss this only in terms of access, product innovation, or return opportunities. Those are part of the story, but not the full story. The more important issue is that as boundaries between markets become less clean, institutions need stronger internal frameworks, not weaker ones. They need a clearer understanding of what risks they are actually taking, how illiquidity interacts with the rest of the portfolio, and whether the governance process is equipped to distinguish between long-term opportunity and simply delayed mark-to-market recognition.

I also found myself thinking about AI, which came up directly and indirectly throughout the discussions.

Like most important technologies, AI is likely to be oversold in some areas and genuinely transformative in others. In investing, I do not think the central issue is whether AI can generate more information. It obviously can. The more important question is whether institutions can remain accountable for decisions in an environment where information becomes abundant, models become more opaque, and explanation becomes easier to simulate than judgment.

That, too, is a question of trust.

One of the things I appreciated most about the trip was that the conversation did not stop with markets. In the evening, I attended a CAIA Chapter gathering where the discussion turned to diversity and gender equity. I was glad it did.

As someone who serves as a Gender Focal Point at UNJSPF, I do not see those issues as separate from institutional quality. They are part of it. An investment organisation is shaped not only by the quality of its models and decisions, but also by who feels heard, who has access to opportunity, and whether fairness is treated as part of leadership rather than as an afterthought.

In that sense, diversity is not just a cultural topic. It is also a governance topic. Institutions make better decisions when they are willing to question inherited assumptions, widen the set of perspectives around the table, and create environments where people can contribute fully without having to spend energy navigating avoidable inequities. For asset owners, that matters because good governance is never only about committees and policies. It is also about culture.

For me, one of the most valuable aspects of Milan was that it connected these questions rather than separating them. Trust, accountability, inclusion, and decision quality are often discussed in different rooms. In reality, they belong in the same one.

If trust is central to the asset owner’s role, accountability cannot stop at outputs alone. It has to extend to process: how decisions are made, how uncertainty is framed, how risks are identified, and how institutions ensure that the adoption of new tools does not weaken human responsibility.

For me, one of the most valuable aspects of the Milan discussion was that it connected all of these issues back to the same foundational point: institutions need to remain anchored in their mandate even as the world around them becomes more fluid.

That anchoring is not rigidity. It is the opposite. It is what allows a fund to adapt without becoming unmoored.

It is what allows an institution to respond to a more fragmented geopolitical environment without turning every headline into a trade. It is what allows an allocator to engage with new forms of product architecture without confusing complexity with progress. And it is what allows organisations to use new technologies without outsourcing judgment.

In the end, I left Milan thinking that trust is not something beneficiaries give us once. It is something institutions have to keep earning — through clarity, discipline, and the willingness to make hard decisions in a way that remains faithful to why the capital exists in the first place.

That is not a communications challenge. It is an investment one.