Asset Managers Show Strong Efforts at DEI, Survey Finds

How committed are asset managers to diversity, equity and inclusion? Very. That’s the finding from a study by the Callan Institute, the research and education arm of consultancy Callan LLC.

The results of the survey of 1,200 asset managers, Callan’s first on the subject, were that 70% had a formal DEI policy, 71% had diversity recruitment initiatives and 65% had a DEI training program. Further, 50% sponsor a mentor program, where more senior employees guide new hires from underrepresented groups.

These findings are important to allocators, whose organizations hire outside managers to invest assets, often with a focus on particular asset classes, such as private equity.

One crosscurrent: Just 37% of the responding firms had a pay parity policy, meaning that people in the same job at the same location get equal pay regardless of race, gender or other factors. The study noted the low positive response rate and commented that this issue appeared “to be one of the more challenging policies to implement across the industry.”

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The surveyed firms that have DEI programs, like pay parity, tended to be larger (more than 750 employees) and handled more money (more than $100 billion assets under management).

The clustering of DEI programs in the larger firms, by both workforce size and AUM, showed that they “tend to have more resources and organization-wide policies overall, including DEI,” the study concluded. The number of firms that were diverse-, women- or disabled-owned was only 18%.

The Knight Foundation also found in a series of surveys—in 2017, 2019 and 2021— very low levels of diverse-owned firms in asset management, with the last one showing 6.1% owned by minorities and also 6.1% by women.

What about investment specialties? Looking at pay parity in the Callan study, private equity had the largest number of firms devoted to that DEI category, at 55% of PE companies, with fixed income at 45%, real estate at 35% and stocks at 32%.

For diverse recruitment initiatives, PE firms again were the leaders, at 91%, although the other asset classes also had a high showing here: 79% for fixed income, 77% for real estate and 63% for equities.

For mentorship, PE led with 68% offering that kind of guidance, closely followed by fixed income (63%), real estate (52%) and stocks (42%).

In terms of race and ethnicity, the survey found that—to no one’s surprise—whites made up just over two-thirds of the headcount at surveyed firms, with Asians 16%, Hispanics 7% and Blacks 6%. And also unsurprising was the gender finding: the surveyed firms’ workforces are 60% men to 40% women.

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