I have an idea: Let’s stop talking about Ken Fisher.
Instead, let’s start acting on the power dynamics that produced his crude remarks and related behavior in the business. While we have to call out bad behavior, and women can lean in all day long (and they do), the problems Fisher’s crass commentary exposed are not individual problems.
Turning the outcry over Fisher into a true tipping point for the finance sector is going to require structural change.
That sounds like a heavy lift, yet I know from personal experience that nothing is more energizing — for finance professionals and our clients —than moving money toward a more equitable society and benefiting from doing it.
In that spirit, here are three solutions we can all start working on right now.
- Hire and work with more women asset managers.
Not many people realize that fewer than 5% of asset management firms are owned by women (a key finding of a recent Knight Foundation Study). That imbalance not only makes it harder to change sexist cultures, it also robs our economy of the particular perspectives women bring.
Women tend to evaluate investments differently — focusing less on cap size and more on management quality and longer-term projections, for example — and that can uncover a different set of opportunities and risks.
Research on how well women manage assets is thin, yet what we’ve learned so far suggests that women perform as well as or better than men — and diverse teams perform best of all. (In addition to the Knight study, see this earlier Morningstar research.)
If every fund had at least one female manager, that would make a huge difference. More would be better. Financial advisors can help make this happen by adding gender criteria to their due diligence checklist: Check a fund’s management and if you don’t find any women, ask why not.
Right now the imbalance is not on many people’s radar, and yet it’s easy enough to put it there. I am finding that significant change happens one conversation at a time.
- Advocate for policy change.
California has mandated that all publicly traded companies headquartered in the state include at least one female director by 2020, and other states are actively considering similar laws. We can support this movement.
I would love to say we don’t need mandates, yet without them, progress toward board diversification has occurred at a snail’s pace. The advantage isn’t just representation for more than 50% of the population; there’s also evidence that women tend to shift the culture of boards, prioritizing better governance and reining in overconfident CEOs.
You may be surprised at how effective speaking out on this issue can be: the investor voice reigns. My firm undertook an advocacy campaign promoting diversity on boards, starting with letters and following up with phone calls. We’re filing resolutions if we don’t get a response.
Mostly, though, we are hearing back from companies, and they want to talk about how to incorporate best practices for promoting diversity and inclusion within their organizations. For example, one company said they’ve been working on board diversification, and our letters of encouragement and resolution provided the impetus needed to add diversity and inclusion to the board agenda.