Page 38 - Investment Advisor July/August 2023

Broker-Dealer/rIa ConferenCe Beat

hosted by Bloomberg’s Carol Massar.
Clayton, currently the non-executive
chair of Apollo Global Management,
also discussed the importance of capi-
tal markets and private markets to the
national and global economy — and
the need to provide ordinary investors
with better access to the opportunities
afforded by private market investing.
Throughout the wide-ranging discus-
sion with Massar, Clayton spoke about
the challenges facing financial regula-
Robin vince and Alicia levine tors at a time when the emergence of
novel technologies, from cryptocurren-
Levine, Vince said artificial intelligence our technology upkeep and development.” cies and non-fungible tokens to genera-
and machine learning capabilities are an Vince emphasized that the launch of tive artificial intelligence, seems to be
important area of investment across the the Wove platform is just the most recent constantly accelerating and evolving.
entire BNY Mellon organization — and example of the firm “building to get ahead Reflecting on his time at the helm
that a lot has already been accomplished. of the emerging trends and needs of our of the SEC, Clayton said the job isn’t
Regarding the world of wealth man- clients. The goal in this kind of work is to an easy one. It never was, and it’s only
agement, he echoed Crowley’s remarks, solve the problems that are emerging — increasing in complexity as time goes
arguing artificial intelligence capabili- the problems that people are increasingly on. What is less challenging, Clayton
ties will be best deployed when they going to encounter. That’s where a good said, is maintaining the desire to go
complement, not replace, the work of strategy and a good ability to listen to after bad actors and those attempting to
skilled and trusted human advisors. and understand the needs of our clients manipulate investors and the markets.
“I see AI as a really exciting topic for comes into play, whether within Pershing Clayton explained that a lot can be
all of us across the organization, especial- or in any other part of the business. learned by studying the evolution of cryp-
ly in the Pershing business,” Vince said. “I often say to our people that we tocurrencies over the past five or so years.
“This kind of technology, as a wealth can’t have a crystal ball to see the future. On the one hand, he explained, “crypto”
advisor, can really be your co-pilot and That’s not possible, but we can have a is simply one use case of a new and evolv-
help you understand what your clients crystal ball to see the present if we take ing type of technology that could very
might want to do next. It can help you do advantage of all of the information at well prove to be fundamentally important
deeper planning so much more quickly our fingertips. Through our scale, we to global markets in the long-term — i.e.,
and easily. The future will bring more can see trends coming into the market- distributed blockchain ledger technol-
innovation, but right now, AI can already place, and we can innovate to stay ahead ogy. On the other hand, “crypto” is also
be a lever that helps us to do things more of them,” according to Vince. a lens that clearly demonstrates the risks
efficiently — to get a depth of planning that come along with rapidly developing
insight that would normally take hours, reGULATors CAn’T BoW To TeCH technologies that can foster effectively
days or weeks to accomplish.” Financial market regulators must allow unregulated trading activity, much of
Stepping back from the topic of AI, he room for the creation of innovative and which ends up harming investors.
explained that BNY Mellon will continue novel technologies that have the potential “Ultimately, blockchain technol-
to invest in whatever technology capabili- to greatly benefit investors and the econ- ogy has manifested itself in a number of
ties will benefit the firm’s clients, and he omy, but they also have a duty to ensure financial products, some of which have
said the scale of the organization will make they are not bending to the will of unscru- been adopted by a subset of investors
that investment hard to match. “Frankly, pulous or reckless actors who are willing, with what I would call almost a reli-
we have the ability and the expertise to maliciously or not, to overlook the fair gious zeal,” Clayton said. “Some actors
make really powerful investments in all treatment of their clients and investors. believed that this new tech is so power- Photo: BNY Mellon Pershing
of these areas, and we are doing just that,” So argued Jay Clayton, the former ful that regulation would simply have to
Vince said. “To give you some perspective, chair of the U.S. Securities and Exchange bend to the technology. That can’t hap-
we spend about $3.5 billion per year on Commission, during a “fireside chat” pen, in my view. We’ve built too strong

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