Less than half of asset managers assess gender diversity as part of their investment analysis, says Redington research
Research carried out by Redington has found that less than half (47 per cent) of asset managers assess gender diversity when researching potential investments – despite recognising its importance within their own firms.
While gender diversity isn’t a factor in a majority of managers’ investment decisions, it is something that 77 per cent of them measure internally.
Furthermore, 58 per cent of those surveyed told Redington that gender diversity was an important contributor to their success.
The results are part of an in-depth survey of more than 100 asset managers based around the world, representing 192 different investment teams with USD10 trillion in assets under management combined, documenting their attitudes towards Responsible Investing issues.
The data also shows that two-thirds of asset managers had less than 25 per cent female representation on their investment teams and 60 per cent did not report their gender pay gap in 2019.
Nick Samuels, Head of Manager Research at Redington, says: “While our research clearly shows that many asset managers understand the importance of better gender diversity and are taking steps to measure and monitor it, we are seeing a very mixed picture of how this translates to team structures and decision-making.”
“Our survey uncovered some thoughtful approaches to diversity, but we also have to ask ourselves whether some in the asset management industry are just paying lip service to this important topic.”
Samuels noted that while Redington will be pushing its managers to improve in these areas and holding those who don’t to account, they do not expect this change to happen overnight.
“We view diversity and inclusion not just as the ‘right thing to do’ but something that helps create a highly effective and competitive workplace, making it an important consideration factor when assessing a manager’s capabilities.
“While we recognise that each organisation must plot its own path based on its own history, culture and needs, investment managers should recognise that expectations are changing from both staff, future hires and the wider society. Understanding these perspectives is becoming ever more important to be successful from an internal and external point of view.”
Samuels was optimistic to see managers’ heightened understanding and engagement with cognitive diversity – the desire to hire people who think in different ways – with 67 per cent of managers surveyed believing this was important.
While formal measurement of cognitive diversity remains low, at just under a fifth, Samuels said this was likely down to the complexity of measuring this diversity characteristic.
“Cognitive diversity is much more nuanced, and therefore harder to measure than other aspects, often requiring external resources and costly analysis, which many managers may not currently have available.”
“Pointing them in the right direction should be a key priority as, in a fast-moving world, having more data that allows management to better understand their greatest asset – their people – has to be a good thing.”