Women Investment Professionals

KEY TAKEAWAYS: WIP WIN SERIES – Moving the Needle on Diversity Equity and Inclusion

July 8, 2021

Definition: DEI

  • The courage to act, commitment to lead, and conviction to change is what is necessary to successfully implement a DEI effort.
  • Dance analogy:
    • Diversity – Being invited to the party
    • Equity – Being asked to dance
    • Inclusion – Being asked what kind of music you want to dance to
  • Often times, the terms are treated as one; when trying to make change, you must have separate policies.

DEI Priorities

  • DEI must be assessed internally and for clients/externally.
    • The former is imperative to serve the community as well as increase performance.
    • Externally, diverse teams are more profitable, as research shows, adding ~20 basis points per year.

The Evolution of DEI:

  • In the past, diversity was about representation – affirmative action. The conversation and resulting engagement are different now, i.e. much more prevalent. “The stakes have gone up.”
  • Equity among people is the most important now. This is increasingly more business-specific vs. past DEI considerations.

Impact on Recruiting and Retention:

  • Is it moving beyond race and gender? Yes, DEI is also about the expanding talent pool.
  • Clients, communities are diverse; businesses have an impact on their community and that is import for their business.
  • 30-40% of Generation Z individuals are non-binary. Losing people is expensive.

Best Practices for Asset Managers:

  • DEI is part of the due diligence process. Must think outside the box and engage with managers.
  • Share information. Recruiting is one way to start, but have to start to build a pipeline of talent.
  • Have measurable near-term goals and be able to measure progress. Remove biases from systems and processes.
  • Use the firm’s stature: be deliberate with your DEI strategy.
  • Expand partnerships beyond typical recruiting colleges.
  • Engage with clients re. workforce diversity on stewardship, etc.
  • Social impact in underserved communities; look holistically at DEI.
  • DEI is key to success – all employees are accountable. Resources – surveys, exit interviews, real talk conversations, attrition, benefits, employee resource groups; test the direction the company is moving in.
  • Some corporations share information publicly and with prospective clients. Use consultants to review policies.
  • Create a DEI council and relevant committees based on employee feedback.
  • Asset owners should measure their diversity; it is not always easy to do but imperative to know where you are today. Look at leadership team and investment committees to assess diversity.
  • Create/assess future plans.

The Future of DEI

  • Varies a lot by country; no one size fits all, other than gender diversity. Other ways to measure: expats, neuro diversity, age diversity.
  • Diversity is part of succession planning, as well as community partnerships.
  • Age diversity – return to work programs for people out of the work force; military programs help with age diversity.
  • Be aware that some information cannot be disclosed due to privacy rules.
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