The fund management industry is failing on gender diversity, according to a new global report.
Investment analysts Morningstar found that the proportion of women managing mutual funds has not increased at all over the past 20 years.
Its data shows that just 14 per cent of fund managers are women, an identical proportion to the number of female fund managers back in 2000.
These are global figures, covering more than 56 countries. But these figures show the number of female managers in developed markets, such as the UK and US was less than this average.
In the UK just 13 per cent of funds are run by females, and this figure falls to 11 per cent in the US.
This research comes as those in the fund management industry are trying to encourage companies to have more diverse boards.
There has been widespread focus on issues of diversity, and this is a key consideration when managers take into account environmental, social or governance (ESG) factors when selecting companies to invest in.
This data suggests that while fund managers are urging companies to do more on this issue, they are failing to address the imbalances within their own industry.
Morningstar director of quantitative research — and co-author of this report — Madison Sargis says: “Even given all the focus there’s been in the industry on increasing diversity, given the benefits it’s produced, we haven’t seen that pan out in the overall numbers of women portfolio managers.”
The proportion of women running mutual funds in the US has actually declined over this period. In 2000 women made up 19.4 per cent of passive fund managers in the US, and 13.4 per cent of active fund managers. Since then there has been a huge growth in the number of passive mandates, driven by the growth of Exchange Traded Funds.
However in 2019 only 13.2 per cent of passive fund managers in the US were women, while the number of female managers running active funds also dropped – to 10.7%.
Morningstar’s UK team showed this imbalance in recent research that revealed that there are more funds in the UK run by people called Dave (or David) than there are by women.
This survey covered looked at both actively and passively-run funds across equity, bond and multi-asset funds. This included target-date retirement accounts.
This failure to address diversity may be hampering outcomes for investors. Previous research by Morningstar showed that bond funds run by women outperformed those run by men from the period of 2003 to 2017.
Numerous report have indicated that companies that have more gender diverse boards, and women in a range of senior management roles tend to perform better that those run solely by men from a similar background.
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