Innovation and Impact: Defining the Next Phase of Growth

Technology is no longer simply transforming industries. It is reshaping how companies, policymakers and investors think about growth, competitiveness and long-term value creation. From electric aviation and robotics to healthcare innovation and water infrastructure, leaders across sectors are adapting to rapid technological change amid shifting geopolitical and market dynamics.

Those themes were at the center of discussions during Morgan Stanley’s 2026 Innovation & Impact Summit, where executives and investors examined how innovation is redefining sectors, markets and economies.

“Over the years, innovation and sustainability have increasingly become central drivers of capital allocation, corporate strategy and economic competitiveness,” said Jessica Alsford, Morgan Stanley Chief Sustainability Officer and Co-Head of the Morgan Stanley Institute. “What has not changed is our approach: We remain client-driven, focused on providing clear, data-driven perspectives and on bringing together the full capabilities of Morgan Stanley to help our clients navigate complexity and identify opportunity.

Here are some of the key areas undergoing transformation that were discussed at the Summit.

Robotics Could Help Revive U.S. Manufacturing

As artificial intelligence increasingly moves from software into the physical world, robotics applications are becoming more visible in daily life: making deliveries, moving items in factories or cleaning homes.

At the same time, the U.S. faces a strategic challenge: Most robots used within its borders are manufactured overseas, creating potential economic and national security vulnerabilities. China, which has prioritized robotics and humanoid development for years, continues to lead the sector. By 2024, the country accounted for 54% of the world’s new industrial robot installations. Last year, roughly 90% of humanoid robots shipped globally came from China, according to Morgan Stanley Research.

Evan Beard, Founder and Chief Executive Officer of Standard Bots, emphasized the importance of establishing a stronger domestic robotics ecosystem in the U.S.

“For decades, we've been eroding our manufacturing base,” Beard said. “This technology has created a window of opportunity for us to rebuild our supply chain and manufacturing, becoming more competitive as a country.”

Standard Bots, a New York-based company, develops robots designed to expand access to automation for manufacturers.

Energy Solutions to Power AI

The rapid expansion of artificial intelligence is placing unprecedented demands on energy infrastructure, accelerating innovation in power generation and delivery.

KR Sridhar, Founder, Chairman and CEO of Bloom Energy, said the growing “AI power crisis” is driving a fundamental rethinking of energy systems.

“We finally went from putting a band-aid on the failed infrastructure,” Sridhar said. “On-site power is not just a stopgap, but a structurally better solution for AI workloads.”

With its fuel-cell systems, Bloom Energy aims to provide faster deployment, grid-independent reliability and cleaner energy generation for data centers and other large-scale users.

John Ketchum, Chairman, President and CEO of NextEra Energy, said the surge in data center demand is reshaping relationships between utilities and technology companies.

 “The discussions we’re having with hyperscalers now are different from the past,” Ketchum said. “We’re now talking about very large transactions that require us to partner and start committing capital earlier.”

Ketchum said long-term competitiveness for utilities increasingly depends on the ability to deliver integrated energy solutions that combine renewables, natural gas, storage and nuclear power.

“Early capital deployment, supply chain lock-in, labor contracting and interest-rate hedging enable cost control and execution certainty that others cannot match,” he said.

Electric Aviation Begins to Scale

Jet fuel represents one of the aviation industry’s largest operating costs alongside labor—accounting for as much as 40% of expenses. Electric aviation is emerging as a potential solution, with the opportunity to significantly reduce operating costs.

Vermont-based Beta Technologies is among the companies seeking to accelerate the commercialization of electric aircraft for both vertical and conventional takeoff. But instead of focusing on a standalone product, electric aircraft, Beta recognized the need to invest in the enabling technologies that would make electric aviation viable, including charging infrastructure, systems and services.

“Now, it’s about how to scale it,” said Beta’s Chief Financial Officer Herman Cueto.

According to Cueto, the company is seeing growing commercial traction, supported by a substantial aircraft order backlog and rising demand for components and services.

Addressing Water Scarcity

Water security is also emerging as one of the world’s most pressing long-term infrastructure challenges. More than 3 billion people currently face water stress globally, a figure that could rise significantly by 2050.

At the same time, AI and data centers are becoming a major new source of water demand.

“By 2050, data center water consumption could rival the combined populations of London, New York and Los Angeles,” said Emmanuelle Menning, Deputy CEO Finance & Germany BU at Veolia.

To address growing supply pressures, companies are investing in water reuse, desalination and leak-reduction technologies.

“In the U.S., water infrastructure is in dire straits and requires massive capital investment,” said Cheryl Norton, Executive Vice President and COO of American Water. “Many utilities we acquired had water loss rates of 60% to 75%, forcing customers to conserve just to keep systems functioning.”

Both Norton and Menning highlighted regulatory reforms and industry consolidation as potential drivers of increased investment and operational efficiency in the fragmented U.S. water sector.

The Evolution of Investing

Global investors at the Summit discussed how investing strategies are evolving amid heightened market volatility, geopolitical tensions and changing regulatory environments.

One asset owner highlighted contemporary challenges and opportunities facing the growth of sustainable investing, which have raised the table stakes, requiring asset managers to be more thoughtful in strategy development and execution.  

John Rogers, Jr., Chairman and Co-CEO of value-driven asset management firm Ariel Investments, highlighted the importance of resisting short-term market volatility and maintaining focus on long-term principles.

He reinforced that mission‑driven culture and diversity continue to be sources of durable competitive advantage.

“I still think those principles make your company stronger,” Rogers said. “Communities engage with them, young people and customers care about them and they help you attract talent.”

Financing Longevity

As Americans live longer, pressure is increasing on both public retirement systems and individual retirement preparedness, prompting the industry to seek innovative solutions to address the issue.

According to TIAA—a financial firm that provides retirement services in several industries, including education, healthcare and government—approximately 45% of Americans could face retirement income shortfalls, with even greater challenges for women and people of color. In addition, roughly 59 million Americans lack access to a workplace retirement plan.

“We’re not saving enough. This is a structural issue that private markets, the financial ecosystem and policymakers need to work together on,” said Thasunda Brown Duckett, President and CEO of TIAA. “We need to look at all this under an investment lens and define what role institutional capital should play in closing the gap.”

AI’s Growing Role in Healthcare

Technology and AI are also transforming healthcare delivery, patient engagement and treatment outcomes.

Dr. John D’Angelo, President and CEO of Northwell Health, said the U.S. healthcare system faces mounting capacity pressures as the population ages and demand for care rises.

“We have to leverage technology to amplify the capabilities of the existing workforce to meet the demand,” D’Angelo said.

He pointed to AI applications in imaging, diagnostics, , as well as advances in biomedicine, as key areas driving change.

“We can use all of this to better support our patients and team members, while improving the delivery of care and also driving affordability,” he added.

D’Angelo also emphasized the importance of using technology to address chronic disease through preventative care, including wearables and data-driven health monitoring.

“We have an epidemic in this country: diabetes, hypertension and obesity have all doubled or tripled over the last few decades,” he said. “Instead of episodic care, we have to get more proactive to keep people healthier and better manage chronic diseases and decrease demands."

While AI has the potential to improve healthcare outcomes and efficiency, it also raises complex questions around privacy, governance, accountability and patient consent. That would require many new standards for the industry, including direction on how to inform people of the deployment of AI tools in medical procedures and rules regarding the use of patient’s data.

Vardit Ravitsky, President and CEO of The Hastings Center for Bioethics and Senior Lecturer on Global Health and Social Medicine at Harvard Medical School, said patient safety must remain the priority as AI adoption accelerates.

“We need guardrails that support innovation, but adoption of AI in healthcare cannot be subjected to the race for dominance,” Ravitsky said. “Health is different, because people may die if there’s no attention to risks.”