Campbell

"Businesses need to gear themselves to meet the demands of Generation Y consumers and employees" Profound demographic change will force the funds-management industry to look beyond the 'baby boomers' to the 'twenty-somethings', otherwise called Generation Y, a leading auditing and advisory firm has warned.

A new KPMG International study called 'Beyond the Baby Boomers: The Rise of Generation Y' found that the funds-management industry is "unaware or simply unprepared for generational change affecting their customer base and their employees," said KPMG's Kingston-based office in a release on the study, which was authored by Australian partner Bernard Salt.

Industry complacent

The findings, said KPMG, also indicated that the industry was complacent about seeking out business from the GenY market segment.

"While this survey focused on industrialised countries, we believe the findings resonate within the regional marketplace," said Raymond Campbell, KPMG Caricom's head of financial advisory services.

"Businesses need to gear themselves to meet the demands of Generation Y consumers and employees."

To assess the needs of the 'twenty-somethings', KPMG said it commissioned five focus groups, using participants fitting the Generation Y profile in London, New York, Tokyo, Frankfurt and Sydney.

The study - released in the first week of July in Monaco, a city state located along the French Riviera - surveyed 17 countries. The KPMG findings were based on 125 survey responses, representing only one-fifth or 20 per cent of the targeted responders.

The 125 represented US$3.8 trillion in funds undermanagement, the firm said.

One-on-one interviews were also done with 28 senior executives based in London, New York and Frankfurt.

"The funds-management industry has been catapulted forward on a rising demographic tide. That tide is now receding. Over the next five years, the number of people pushing into 'wealth accumulation' will turn negative," said Salt.

"The industry must take stock, examine its position, and recalibrate its trajectory t with the rise of Generation Y as wealth creators and wealth inheritors if it wants to continue to grow and prosper."

business@gleanerjm.com