84 AI is having a profound impact on business strategy, according to LSEG’s David Schwimmer and Microsoft’s Satya Nadella. While challenges such as data sovereignty and regulatory constraints remain, AI’s potential to drive efficiency, innovation and competitiveness remains significant Overcome industry challenges with AI There is a growing demand for data and AI investment across all industries, but especially for financial services firms. Since 2019, data consumption has increased by about 40 per cent annually for LSEG’s customers, according to its CEO David Schwimmer, who spoke alongside Satya Nadella, CEO and chairman of Microsoft, during a live fireside chat on AI trends for LinkedIn in early 2025 in Davos, Switzerland. Businesses are increasingly investing in AI; driven by both the potential opportunities it provides and the fear of being left behind. Companies are looking to benchmark themselves against competitors and adapt to change. “People want to understand how others in the industry are navigating this [AI] challenge and disruption,” said Schwimmer. The partnership between LSEG and Microsoft is helping navigate these challenges in the financial markets by equipping the industry with the right tools, solutions and insights, combining LSEG's breadth and depth of trusted data and analytics with Microsoft's global cloud and strong AI capabilities. AI as a new factor of production AI is also transforming from a technology that merely enables business processes to one that is having a fundamental influence on worker productivity. “In the past, companies may have thought of technology or IT as an enabler, but now it’s a new factor of production,” said Nadella. “If you’re a pharmaceutical company, it’s about accelerating science; in financial services, it’s about leveraging knowledge.” For Nadella, AI adoption is about translating it into meaningful business outcomes. “The need for this new infrastructure, to translate into transformation, is self-evident at this point,” he said. Challenges with data sovereignty Industries that have not traditionally focused on AI-driven investments are adopting the technology to stay competitive, according to Schwimmer. The consensus from the fireside chat was that companies across all sectors are re-evaluating strategies to integrate AI meaningfully into their operations, but concerns remain about data sovereignty and regulatory challenges. For instance, payment service providers need to remain compliant with evolving anti-money laundering and know-your-customer regulations. Schwimmer pointed out that strict data localisation requirements create barriers for global businesses. “Criminals don’t respect national boundaries, so the notion that data has to respect national boundaries is really like tying your hands behind your back,” he said, highlighting how these regulations complicate efforts to prevent financial crime. “Data sovereignty is an important topic that deserves to get attention.” The LSEG-Microsoft partnership demonstrates how companies can effectively address data sovereignty and regulatory challenges through robust data management and compliance solutions. It empowers customers by enhancing data trust, data sovereignty, and providing a secure, scalable platform, all while adhering to responsible AI principles. Also, LSEG’s World-Check platform helps compliance teams to pinpoint potential crime and minimise false positives, and its compliant identity verification solutions help firms to onboard customers faster. AI’s role in finance One exciting application for AI technology in the financial services industry is to drive customer service improvements. LSEG, REPORT “ Data sovereignty is an important topic that deserves to get attention” DAVID SCHWIMMER, LSEG
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