Why We Need Girls Who Invest
When it comes to gender diversity, asset management has not kept pace with many other professional fields such as law, academia and medicine.
GENDER DIVERSITY IS GOOD FOR BUSINESS
There is broad agreement that gender diversity is good for business. This thinking has been backed up by significant research conducted by McKinsey and others that show that diversity of thought in business leads to more informed and balanced decision making.
Research conducted by Catalyst and The CS Research Institute has shown correlations between higher return on sales, equity and invested capital and gender diversity at the executive management level and the board of directors level at US corporations.
When it comes to investing, a number of studies have revealed that men and women invest differently. Gender differences in investment approach, perspective and experience can enhance long-term investing success.
Simply put, diverse teams are better positioned to help investors realize their goals.
THE NUMBER OF FEMALE INVESTORS IS decreasing
The number of women investment managers in the United States currently is startlingly low. And the statistics are getting worse. Research by Morningstar and flowspring report less than 10% of U.S. portfolio managers of US mutual funds and exchange traded funds are women. Further, this reaserach indicated that the number of female investment managers in the $15 trillion US mutual fund marketplace has fallen every year for the past six years, from 10% in 2009 to less than 7% today. According to Kip McDaniel's 2014 article “The Missing Women of Asset Management”, in alternative asset classes, women represent 6% in private equity, 4% in real estate and 3% in hedge funds.
The pipeline of female candidates for investment jobs is small
Asset management firms are realizing that they have an unintended talent constraint. For decades now, the talent has come from one small corner of the talent pool. Today the industry is missing out on women's intelligence, creativity, and values when it comes to managing money.
While evidence supports the need for gender diversity, young women are less aware that a career in investment management can be meaning and impactful work.
Negative industry perception and mistrust grew dramatically following the 2008 global financial crisis and is still prevalent today.
When our founder, Seema Hingorani, published an op-ed in Bloomberg titled "'Girls Who Invest’ Would Change Wall Street” she did not expect the overwhelming response that she received.
The groundswell of support from men and women in the investment and academic communities globally was a wakeup call signaling that the dearth of female investment talent in the asset management industry had become a critical issue. This reality will not change without a proactive solution to recruit women into the investment business. Girls Who Invest offers asset management firms a real and tangible way to make the inclusion of women on their investment teams a top priority. In doing so, together we can transform the industry.
Now is the time to act.