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Financial advisory firms that want to attract more female, millennial and minority advisors as well as clients may be interested in the results of a new CFA Institute initiative focused on diversity and inclusion in investment management.
After holding a series of workshops with top and mid-level managers at 99 asset management and wealth management firms and institutional investors representing roughly $38 trillion in assets, the institute issued a report recommending an “action list” of 20 ideas that firms can adopt.
Workshops were held in five American cities — Boston, Chicago, New York, Philadelphia and San Francisco — and Toronto between October 2017 and May 2018 with a total 344 attendees. The idea was to learn why organizations want to increase diversity and the strategies they’re using to do so, including the focus of those strategies, best practices, and ideas for future action.
Their motivation broke down as follows: 80% use diversity to improve business outcomes, 71% to attract talent, 52% for ethical and value imperative reasons, 42% for reputation, 28% due to client demand and 6% for compliance purposes.
The focus areas were gender (96%), race/ethnicity (83%), LGBTQ (58%), veterans (45%), millennials (43%), inclusion (39%), ability, such as vision-impaired (25%) and other (8%).
“Just as there are rewards for the right actions, there are risks involved in doing nothing,” according to the CFA Institute report, “Driving Change: Diversity & Inclusion in Investment Management.”
We have included in reverse order the first 10 ideas from the action list, which Rebecca Fender, head of the Future of Finance initiative at the CFA Institute, ranges from those that are most “foundational” to slightly uncomfortable. Seven of the 10 ideas were also included in attendees’ list of the ideas that would have the most impact.
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