Survey: Gender diversity efforts building in alternative asset management

A 2021 survey by global executive search firm Jensen Partners revealed, in a few simple numbers, a concerning truth about gender diversity efforts in the alternative asset management industry.

Of 253 investment credit committee professionals at 50 private debt firms, only 18 of the positions were filled by women. An "unusually low number," given that women make up 40–50% of marketing professionals in the alternative investment space, Jensen noted at the time.

Figures such as these have long troubled an industry that is now facing challenges of meeting the diversity demands from their workforce and the investment community they serve.

But some signs of progress have emerged.

Jensen recently updated its diversity survey with a report indicating increased levels of hires and promotions for women in the private credit, hedge funds/private equity and asset management industry.

In addition, a new industry group promoting gender diversity in asset management has garnered a growing list of signatories pledging to formalize processes and educational training to promote career paths for women into the senior ranks of portfolio and firm management.

Candice Richards, managing director and the ESG/compliance officer of alternative asset manager MidOcean Partners, this past summer helped establish The Women's Awareness Initiative (WAI), with a mission to promote the improvement of women's representation in the industry's ranks and in C-suites. WAI was founded by MidOcean, with The Riverside Company, Avante Capital Partners and Churchill Asset Management serving as the initial signatories to the program.

"We don't have enough women that are attracted to the industry, not because they don't have the skill set, but because they don't have the awareness that it is [among] the possibilities in their journey," Richards said, in an interview with LCD.

Richards says the organization will provide guidance on how firms can foster more gender diversity through educational and mentoring programs for women rising through the ranks, as well as career workshops for students who may otherwise not be exposed to asset management as a profession.

WAI has also held regular industry gatherings for women in the industry — including quarterly breakfast clubs. MidOcean has also held a speaker series that has featured such guests as former PepsiCo chair and chief executive officer Indra Nooyi.

That lack of awareness was a factor in her own life, as she recalls having almost no acquaintance with the career possibilities in finance.

"My father had two passions in life, the New York Mets and the New York Post," said Richards. "The Post he would read cover to cover every morning, but he would bypass the finance articles because he couldn't relate to them because he didn't have access to the industry."

"As a daughter of immigrants, and a person who really did not have any true awareness of my possibilities broadly, and in financial services and asset management more specifically, it was important for me to pay it forward," she added.

The WAI, since its launch on July 18, has garnered 13 more signatories from firms representing $140 billion in assets under management. Each of the firms' agreements include pledges to establish a firm-wide communications channel for employees, host an annual intrafirm women's event, and promote the industry to high school- and college-aged female students through opportunity workshops.

In the update to its 2021 diversity study released Sept. 14, Jensen noted an increased number of women added or promoted to senior roles in the past year at private credit firms (as well private equity and hedge funds) versus the year prior.

The survey showed women were represented in 42.7% of hires and promotions to the senior level, versus 37.8% between 2020 and 2021, "which we view as a positive sign that women are rising to the highest ranks at these organizations," the report stated. Private equity, hedge funds and multi-asset firms "were responsible for the bulk of senior-level moves."

Gender diversity is also broadly increasing in the industry, with 2,645 women being hired for junior and senior roles at firms in 2021, versus 1,749 in 2020.

Since late 2021, Jensen has pledged to ensure that at least 51% of the candidates it forwarded to clients were from underrepresented backgrounds, including women.

"[G]ood intentions and ad hoc initiatives are not enough to move the needle on DEI (diversity, equity and inclusion) within the alternatives industry," the firm noted in the new report. "We want to continue measuring progress and encouraging asset managers to tackle our industry's disparities."

Featured image by melitas/Shutterstock

This article originally appeared on PitchBook News