POWERED BY MOMENTUM MEDIA
‘Disappointingly slow’ progress on investment industry diversity
Diversity progress is “disappointingly slow” in the investment industry, according to Willis Towers Watson, as it releases an action plan to accelerate the pace of change.
Its ‘Diversity in the Asset Management Industry’ report used a diversity score to establish a view on a firm’s gender and ethnic diversity as well as insights gained through its qualitative manager research process. Asset managers who failed to encourage greater diversity or did not respond to growing asset owner expectations could face a ratings downgrade.
The firm is encouraging asset managers, investment consultants and discretionary investment solution providers to consider eight factors:
- Greater transparency and disclosure: high-level statistics to understand how diversity is reflected across different functions;
- Increased sourcing of diverse talents: for example, through graduate and returner programmes;
- Measurement of diversity of asset managers that goes beyond just equity ownership;
- The removal of requirements that may unwittingly exclude diverse funds/firms;
- Progressive compensation structures and policies around flexible working arrangements;
- Shifting away from a star portfolio manager model to a team-based investment approach, with a strong focus on ensuring decision-making teams are diverse;
- Asset owners and investment consultants to establish targets to significantly increase the diversity in portfolios, with the associated improvement in expected performance; and
- A focus on internal policies, training and networks designed to increase diversity and address the challenges of racism, sexism and other unconscious biases.
Chris Redmond, head of manager research at Willis Towers Watson, said: “Addressing the systemic issue of poor diversity in the asset management industry requires a collective effort, and in many cases a fundamental change in mindset and culture.
“Although some of these efforts will take time to bear fruit, as an industry we need to be challenging ourselves to do more now. Improving diversity is key to building a stronger investment industry, and our initial findings show that it is positively linked to performance outcomes.”
Willis Towers Watson senior investment consultant, Angela Brown said: “We recognise that businesses are at different points in their diversity journey today, and these proposed actions are just the starting point upon which the industry can build.
“While we recognise the challenges that lie ahead, we strongly believe that by taking these steps, the investment industry can take a crucial leap forward in better reflecting our society and delivering better performance outcomes for savers.”
AUTHOR
Laura Dew
Laura Dew is editor at Super Review. Prior to joining SR, she spent five years working at Investment Week in the UK covering asset and wealth management.
Recommended for you
Australia is becoming increasingly recognised as an attractive investment opportunity against global counterparts, recent analysis has found.
Pension funds in Australia and the UK are embracing recent developments that will facilitate the deployment of superannuation capital toward the energy transition in both countries.
With the Goldman Sachs’ S&P 500 long-term outlook occupying headlines over recent days, an Aussie economist has weighed in, noting that, while difficult to time, the US market is poised for a downturn.
The appetite for digital infrastructure has grown significantly among Australia’s superannuation funds, with assets like data centres, fibre optic networks, and telecommunications now viewed as strategic investments in their portfolios.
TOP PERFORMING FUNDS
ACS FIXED INT - AUSTRALIA/GLOBAL BOND
Fund name
3y(%)pa
1
Spire Oaktree Opportunities XI Second Close
61.07 3 y p.a(%)
2
Spire Oaktree Opportunities XI First Close USD
59.21 3 y p.a(%)
3
DomaCom Lot 21 Chellaston Road Munno Para West SA 5115 Australia
32.57 3 y p.a(%)
4
Fidante Credit Suisse Global Private Equity
32.09 3 y p.a(%)
5
DomaCom 4/27 Crombie Avenue Bundall QLD 4217 Australia
27.42 3 y p.a(%)
