An estimated $72 trillion is set to change hands over the next two decades, marking a significant wealth transfer from baby boomers to younger generations. Boomer women are poised to become a more significant group of HNW clients. This generational shift is already influencing the wealth management landscape, as baby boomers increasingly embrace the concept of "giving while living" by transferring wealth to heirs before their passing. The incoming generation of investors presents a distinct set of preferences and expectations. Younger investors are drawn to alternative investments and impact investing, seeking to align their portfolios with their values. They also anticipate highly personalised services tailored to their individual needs and preferences. Interestingly, there's a growing trend of inheritors choosing to donate a portion of their windfall to philanthropic causes, driven by a desire to make a positive impact and, in some cases, a sense of unease with their inherited privilege. 

Inequality can be seen through different lenses: wealth, income, and corporate inequality. The world's richest 1% of the population holds 47.5% of global wealth, whereas the poorest 40% of the population holds only 1% of wealth. The disproportion is even more significant when looking only at Ultra High Net Worth Individuals (UHNWIs) - this group represents 0.003% of the population and holds 6.5% of global wealth. Globally, inequality is on the rise; even in developed, socially focused European countries, inequality remains stable or improves only marginally. AI poses a social risk of increasing inequality by automating low-skilled tasks and improving the market positioning of mega-companies due to their data richness and ability to invest in R&D. The rising cost of debt servicing also poses a risk of lowering social spending. Social tensions are already on the rise, with proposals to introduce a global wealth tax and countries individually looking to introduce additional tax measures for the wealthiest populations. More pressure on both taxation and transparency could be expected in the coming years. 

Automation of processes has been on everyone's radar for years. Now, following the advancements and hype for generative AI, automation is entering a new stage with the use of AI agents. AI agents are an attempt at commercialising generative AI (however, AI agents can also use other AI capabilities), designed to handle specific tasks, including workflows with varied levels of complexity, human interaction requirements, and self-adaptation capabilities. Examples of simpler AI agents are already in use (e.g., chatbots); however, it is expected that within the next few years, AI agents will be able to handle much more complex tasks and multi-task workflows. AI agents will not only allow for vast automation of work but also enable hyper-personalization at scale. This comes with its own challenges and risks related to:

• Mismatch between jobs created by AI and automation and available skills (re-skilling required)

• Security

• Compliance

• IP considerations

• Increased inequality due to the automation of tasks done by less-skilled workers and insourcing and nearshoring replacing outsourcing

More and more banks are active in crypto custody services—CACEIS, Deutsche Bank, BNY Mellon, and several Liechtenstein banks are offering these services. Younger generations of clients are pushing financial institutions to embrace cryptocurrencies, and upcoming regulations in both the EU and the US should further facilitate banks' activities in this space. Among those under 44 years old, cryptocurrencies were indicated as the second most attractive investment choice, while crypto came in second to last in the age group of over 44. Interestingly, younger investors are not attracted to typical investment products (ranked 7th-10th in terms of attractiveness), whereas those over 44 indicated them as the most attractive options.  Cryptocurrency has 617 million users globally (and is still growing), and with a market capitalization of $2.5 trillion (projected to reach $6.6 trillion in 2024), it should not be seen as a peripheral phenomenon. There are over 170,000 crypto millionaires and 28 billionaires, with both figures increasing year on year. This could be an interesting customer base with a need to diversify their investments. Projects around Central Bank Digital Currencies (CBDCs) are advancing, with three already in operation and others in advanced development stages, which will surely make cryptocurrencies even more mainstream. 

Technological advancements, societal polarisation, and escalating global conflicts are fueling new cyber threats, including misinformation, impersonation, and data poisoning. These attacks are becoming increasingly sophisticated and severe. Progress in quantum computing is enabling hackers to break encryptions or steal encrypted data with the intention of decrypting it when the technology becomes available. More and more individuals are falling victim to cyberattacks—whether it's the loss of personal data, misinformation campaigns, or impersonation—leading to reduced levels of trust in big tech companies and other organisations that store their data. 

McKinsey estimates that globally $275 trillion of investment is required from both states and investors to achieve a net-zero economy by 2050. That amounts to $9.2 trillion annually. Bloomberg estimates that the amount spent on net-zero in 2023 was $1.8 trillion (up by 17% from the previous year), leaving a huge gap to cover. Transition investing might become the key topic for investors moving away from ESG investments, which were undermined by many greenwashing cases that decreased investor confidence in ESG data. Transition investing incorporates investments in infrastructure, companies with well-defined decarbonization projects, clean energy startups, and innovation projects. 

In today's world, consumers are increasingly seeking out brands that reflect their personal values and demonstrate genuine authenticity. This shift in consumer behaviour is driving a broader push for transparency across all industries, including finance. The ongoing climate crisis and mounting public pressure are leading to stricter ESG regulatory requirements. Companies are now expected to be more open about their ESG practices, and there is increased scrutiny of greenwashing and ethical claims. Furthermore, regulations aimed at ensuring fairness and protecting consumers are compelling organisations to be more transparent about their pricing structures, internal processes, organisational failures, and data security. The spread of disinformation and fake news has further underscored the need for transparency and accountability. Organisations are not only expected to be truthful about their own operations but also to actively combat misinformation and become reliable sources of information. Organisations that can adapt and demonstrate genuine transparency will be better positioned to build trust and maintain strong relationships with their customers, which could provide opportunities for commercialising some of those operations.

Generation Zalpha, encompassing anyone born after 1996 (combining Gen Z and Gen Alpha), is a digitally native cohort significantly shaped by the COVID-19 pandemic. Characterised as idealistic, individualistic, and socially conscious, they value diversity, authenticity, and impact. They are expected to be active advocates against economic inequality and for environmental causes, demanding equality, care for the environment, and transparency. As they enter the workforce, they will challenge their employers with their nomadic identity, awareness of mental well-being, demand for easy-to-use work tools, and impatience. They are projected to comprise 30% of luxury consumers by the end of the decade and will form an important client group for wealth managers following the wealth transfer. Gen Zalpha's engagement model differs from previous generations; they prefer to socialise online, are eager gamers, and engage with their idols (fandom) and online communities. 

Although it has been almost 50 years since we first heard voices advocating for alternative growth measures that also capture social progress and human well-being, progress has been limited. There are a few examples of this in practice:

• Bhutan: The Gross National Happiness Index (GNH)

• New Zealand: The Living Standards Framework

• India: The Ease of Living Index

• The Netherlands: The Wellbeing Monitor

Currently used indexes are not exhaustive and inconsistent; however, there is an active global discussion on progress matrices that go beyond GDP. The World Economic Forum released a report in 2024 proposing a framework that would allow for monitoring progress from a longer-term perspective, looking at the impact not only on economic but also on social and ecological issues. The WEF proposes capturing: innovativeness (responsiveness to new technological, social, institutional, and organisational developments), inclusiveness (the ability for all stakeholders to benefit), sustainability (limiting ecological footprint), and resilience (the economy's ability to bounce back from shocks). One could expect that similar frameworks will be proposed for companies, enabling validation of investment impact.

After the initial blockchain hype faded, the market is now focusing on utilising the technology for better-defined new use cases, such as real-world asset tokenization and cross-border trading, rather than utilising blockchain as a new architecture supporting existing business processes. This shift has the potential to revolutionise trading and democratise access to alternative asset classes, which is particularly appealing to younger investors. This could be an opportunity for banks that support asset tokenization to secure a bigger share of the wallet with the younger generation (US HNWIs under 44 have a strong preference for alternative asset classes). Major stock exchanges and banks are already developing blockchain-based propositions, and upcoming regulations like MiCA in Europe are expected to further legitimise and accelerate the adoption of this technology in the financial services sector. 

Initially, digital twins were used in construction, infrastructure, and manufacturing projects, allowing for reduced impact analysis, fine-tuning of flows, and simulation of asset conditions. As such, digital twins enable financial institutions to test and monitor processes in branches and ones related to infrastructure, capacity and dependency issues, simulations of security breaches, and testing changes. Recent advancements in digital twin technology and tests run by academia showcased the applicability of digital twins for behavioural science and more generally, social problems. The promise is that synthetic behavioural data generates the same results as actual behavioural data. For financial services, this means not only the ability to test market communication and new services but also paves the way to radical personalization. A huge question mark over the adoption of this trend is the public reaction to the use of personal data in modelling digital twins. 

Impact investing goes beyond ESG and transition investing; it broadens the focus to all of the UN's Sustainable Development Goals, where impact is not only measured by returns and ESG statistics but also by the actual social value it generates. The market of impact investing is growing, however, the data from the market varies as some statistics include ESG investments. The growth is underpinned by shifting demographics, wealth transfer and changing investor attitudes. According to Bank of America’s study, younger investors (below 44 years old) are twice as likely to care about the social value of their investments. Social impact is also more relevant for women, who are expected to inherit staggering amounts of wealth in the coming years. As such, wealth managers should prepare to place impact investing at the very centre of client engagement and, with that, create tools to monitor and report on the impact (which is a challenge today). Further evolution of thinking about new growth measures should also facilitate investor reporting. That, coupled with an ability to help investors actively engage in the causes they support or companies they invest in (stewardship), could become a differentiating factor for wealth managers, especially when attracting younger investors. 

The term "techlash" originates from opposition to digital or computer technology. It has evolved to reflect concerns about the negative impacts of technology on individual well-being and wider society. It encompasses a strong public reaction against the influence of large tech companies, particularly regarding data privacy, social media, and control over online access to information. This backlash manifests in various ways, including limited device access in schools, increased interest in "digital detox," and growing support for stricter regulations on Big Tech. In Europe, techlash also includes efforts to foster local tech companies to compete with Silicon Valley giants. Digital detox is increasingly common—web searches on this phrase are rising 50% year on year. If it becomes mainstream, it might cause friction in the advancement of digital and general technology, as clients may demand services provided outside digital channels, as well as work interruptions. 

Researchers found that following a decrease in empathy among youth from 1979 to 2009, empathetic traits began to rebound around 2010. This resurgence is attributed to several factors. Growing awareness of societal inequalities across geographies, races, and genders, easily accessible through online information, has fostered a greater sense of shared experience and understanding. Additionally, periods of social isolation and loneliness, caused by events like the COVID-19 pandemic, have led to an increase in empathy and compassion. Educational systems are also playing a role, with a greater emphasis on mindfulness and empathy training in schools, nurturing these qualities in younger generations. This shift is reflected in a rise in volunteerism, with more individuals dedicating their time and energy to helping others. Can we imagine a world where the biggest fortunes are actively redistributed? 

Researchers found that following a decrease in empathy among youth from 1979 to 2009, empathetic traits began to rebound around 2010. This resurgence is attributed to several factors. Growing awareness of societal inequalities across geographies, races, and genders, easily accessible through online information, has fostered a greater sense of shared experience and understanding. Additionally, periods of social isolation and loneliness, caused by events like the COVID-19 pandemic, have led to an increase in empathy and compassion. Educational systems are also playing a role, with a greater emphasis on mindfulness and empathy training in schools, nurturing these qualities in younger generations. This shift is reflected in a rise in volunteerism, with more individuals dedicating their time and energy to helping others. Can we imagine a world where the biggest fortunes are actively redistributed?

The traditional concept of ownership is being rethought and will undergo a transformation, driven by factors like the circular and purpose economies, technological advancements, and evolving social norms. New models are emerging, including temporary, shared, fractional, and tokenized ownership, as well as a shift from owning to renting. Some organisations are exploring more radical approaches like stewardship or partial common ownership. These models challenge the conventional shareholder-centric approach and aim to create a more equitable distribution of wealth and decision-making power. Early studies suggest that stewardship-based companies can be as profitable as traditional ones while being more innovative and resilient. The rise of new ownership models reflects a broader societal shift toward more sustainable and inclusive economic practices, sometimes referred to as "Capitalism 2.0." 

Virtual Reality is a computer simulation that enables a person to interact with a 3-D model of an environment, which can simulate reality or engage users with artificially created worlds. Virtual reality has its first applications in business, such as virtual stores, art spaces, and virtual training, to name a few. As users need to interact with virtual environments, the development of interfaces is very important. Goggles like Vision Pro have already hit the high street, with the expectation that the tools used will become smaller and more seamless. A critical breakthrough is expected with the development of the Human-Machine Interface. A more immediate impact will be seen in Phygital, a blend of physical and digital realms, referring to the seamless integration of online and offline experiences. It encompasses real-world applications like QR codes, live video shopping, and virtual communities. The growing popularity of phygital experiences, particularly among Gen Z, is evident in the rising sales of digital fashion items and the influence of avatars on real-life choices. 

The circular economy champions the reuse and recycling of materials, breaking the link between economic growth and the relentless consumption of our planet's finite resources. This model creates new opportunities: businesses focused on repurposing and refitting, new ownership models (based on renting and sharing) creating new job opportunities and efficiency gains. Even industries traditionally associated with waste, like fast fashion, are embracing the circular ethos, proving that sustainability and style can coexist. While the journey towards a fully circular economy is ongoing, progress varies across the globe. Europe is increasing its use of recycled materials; however, globally, this has decreased. Yet, the urgency of the situation is clear: in the same timeframe, humanity has consumed a staggering 28% of all materials ever used since 1900. 

Amid rising geopolitical tensions and disruptions to global supply chains, a trend toward redefining globalisation is gaining tracktions. Organisations are increasingly seeking to reduce their dependence on providers and manufacturers based in high-risk locations, particularly from countries like China. This shift is driven by a desire for greater self-sufficiency and control over supply chains, both at the company and country levels. Technological advancements facilitate this move, enabling more efficient and cost-effective production closer to home. As a result, we're seeing a resurgence of onshoring and nearshoring initiatives, as companies bring manufacturing and other operations back to their home countries or nearby regions. Emerging economies are also contributing to this trend, as they seek to move up the value chain and develop their own intellectual property and design capabilities. This trend is starting to be visible even in the luxury market, where luxury brands, typically associated with the Western world, are now being challenged by their Chinese competitors. China's investment in global south is a signal of shifting power.  At the same time rising nationalistic sentiment in many countries is fueling the de-globalisation trend. The underlying forces are bound to change globalisation as we know it today.