New York, NY, November 8, 2017 – A new survey on the ethnic and racial diversity of 23 asset management firms, representing more than $5.3 trillion in assets, reveals stark disparities between the number of white and minority professionals in positions of company leadership, as well as investment and distribution roles. The joint research, Ethnic and Racial Diversity at Asset Management Firms, was conducted by the Money Management Institute (MMI) and FundFire.
“Recently, there has been a lot of attention paid to the lack of gender diversity in the asset management industry, but this study reveals that the recruitment and retention of minorities is an equally challenging issue,” said Craig Pfeiffer, MMI’s President and CEO. “It is our hope that these survey results will open up a broader dialogue within the industry on how we can build a more inclusive workplace culture, improve minority engagement and accelerate progress.”
Survey respondents were asked to provide information on the percentage of staff that identified as white (non-Hispanic or Latino), Asian, Hispanic or Latino, black or African American, American Indian or Alaska Native, Native Hawaiian or Pacific Islander, two or more races, or an “other” race – classifications used by the Equal Employment Opportunity Commission (EEOC). Firms, which shared varying levels of data, reported the diversity makeup of global professionals at the executive committee level, as well as those who were in U.S.-based managing director, senior and non-senior portfolio manager, senior and non-senior distribution, portfolio manager associate, analyst, and technology and operations positions.
Whites represent an overwhelming majority of all positions covered in the survey. Only in less senior roles, such as portfolio manager associate (76.9%), analyst (73.4%), and technology and operations (59%), does the percentage of white staff drop below 80% for jobs in the United States. Diversity gaps are the largest at the executive committee level, where 184 out of 209 total employees, or 88%, are white. Following closely are U.S.-based senior distribution professionals, where 86.8% are white, managing directors at 86.3%, and non-senior distribution professionals at 85.5%.
"With this survey, we aimed to present hard data that would, not only support discussions about diversity efforts and recruitment in asset management, but help expand the conversation to specific roles and areas of the business where minorities have the hardest time breaking the glass ceiling," said Danielle Walker, reporter at FundFire. "Our survey report is a starting point, but hopefully one that can serve as a roadmap for further initiatives focused on workforce diversity and inclusion."
Among minority employees at asset management firms, black and Hispanic professionals are present in fewer numbers than Asian professionals in similar positions, the survey found. Out of 209 professionals in global executive committee positions, only 6.7% are Asian. Black and Hispanic professionals each represent just 2.4% of executive-committee level employees, with only five black executives and five Hispanic or Latino executives at this level across the survey sample.
Firms were also asked to identify the areas of their business that presented the biggest challenge to attracting and retaining minority professionals. Distribution (44.4% of firms) leads the way, followed by portfolio management (33.3%). Eight out of 18 respondent firms identified filling U.S. distribution roles as their top diversity dilemma.
Nearly 40% of asset managers said that referrals from existing employees have proven to be the most effective method to recruit and hire minority asset management professionals into senior positions. In addition, survey respondents pointed to improved college and university engagement and internship programs as important ways to close the industry’s diversity gap. Nearly 28% (5 out of 18 firms) said that “changing industry culture” could similarly have a significant impact on promoting progress.
The publication of the full report in FundFire coincided with a series of articles devoted to some of the recurring themes identified in the survey. To download the full report, visit www.MMInst.org.
About the Money Management Institute (MMI): Since 1997 MMI has been the leading voice for the global financial services organizations that provide financial advice and professionally-managed investment advisory solutions to individual and institutional investors. Through industry advocacy, educational initiatives, regulatory affairs, data reporting, and professional networking, MMI supports and advances the growth of a diverse spectrum of investment advisory solutions that serve an evolving worldwide financial landscape. MMI member organizations are committed to the highest standards of fiduciary responsibility and ethical conduct and to creating the most successful outcomes for investors at every level of assets. For more information, visit www.MMInst.org.
About FundFire: FundFire is the leading source of competitive intelligence for the separately managed account industry. Each morning, FundFire delivers a mix of original articles and summaries of the most important industry news to over 80,000 readers which helps investors, managers and consultants stay abreast of the changes in their industry. Investment managers read FundFire to find out what competitors and prospective clients are doing and thinking. Financial advisors, investment consultants, pension plans, endowments and foundations rely on FundFire to power their money management IQ. FundFire also has sections devoted to major personnel moves in the money management industry. For more information, visit FundFire.com.