29 December 2020
This month I am celebrating 25 years at LCP and, as we move into a new year – and a much talked about “new normal” – it feels like a good time to think about what lessons have been learned over the past quarter-century and ponder what life in the UK will look like in 25 years’ time.
Since 1995, developments in IT have dominated the changing landscape of work – with ever increasing mobility and the internet – and I think the pace of technological change will remain relentless. The pandemic has shown us that we don’t need to commute every day; however, the technology isn’t quite like “being there”. A video call is great, but it’s not yet a replacement for a physical meeting.
Having already been lucky enough to use “Telepresence”, which are video calls on steroids, I’m confident that inside the 2020s we’ll have lightweight headsets that enable meetings to take place around a proper virtual table and for participants to feel as if they really are in the same space. There’s an incredible impact for both speaker and listener when someone speaks, and you instinctively turn your head towards them to give them your full attention. That’s something that Teams and Zoom cannot replicate right now – but I’m sure that they will be delivering it relatively shortly.
Artificial Intelligence has already seriously impacted on our lives, from face recognition for contactless payment to driving efficient distribution centres for Amazon, Ocado, and others. The energy industry has already benefited from LCP’s AI capabilities, with LCP Enact, and I hope that we can use our advanced data analytic skills across many other industries going forward.
I am sure that the growth of AI is set to continue, with existing automated taxis and personal assistants getting better and better. However, as quantum computing goes from a nascent industry to a powerhouse of never-previously-imagined computational ability, I think there will also be another transformation in the coming decades regarding how we solve financial, social, and environmental problems.
With the Covid vaccines being produced in record time, we are all starting to see the recent advances made in medical science. Going beyond that, into personal medicine, the healthcare industry in likely to be revolutionised in the years ahead. I’m delighted that LCP now offers healthcare analytics and I fully expect this to be an exciting part of the firm’s future. In the current crisis we have also put together a little modeller to use actuarial techniques to estimate up to date Covid cases, based on the available statistical data.
What about climate change? In the five years since the Paris agreement it may feel like little has really moved on, but I’m much more optimistic: I’ve been talking about climate change for most of this century and recently the discussion has gone ‘main-stream’. Even the investment management industry has realised that factoring in Environmental, Social, and Governance issues is a good way to make money. This means that renewable energy is being installed like never before, and further research money is going towards carbon capture and nuclear fusion.
I was delighted to be part of the team delivering a number of LCP webinars on ESG matters in 2020. Many of which are available for viewing on-demand on our webinar hub. There are still a number of ways out of the climate crisis and I haven’t given up on human ingenuity yet, provided we keep moving in the right direction.
What all this means for the future of the UK pensions industry is hard to predict. I anticipate a lot more assets will be managed highly effectively by “Superfund” consolidators and insurance companies. However, there will no doubt still be plenty of work involved for traditional trustees and corporate sponsors – not least in sorting out GMP equalisation for a good 20 to 25 years yet!
So where will we be in 25 years’ time? My guess is that travelling will primarily be undertaken for pleasure, not work, energy will be as freely available as water, and technology will organise our lives in ways we have yet to imagine. It’s daunting to imagine all the possible changes, but I believe that there is a bright future out there, if we take the right next steps.