The data, taken together, are hard to refute. Asset management is a male-dominated field — in absolute numbers, pay and leadership — and that could be harming returns.
Pensions & Investments' special report on the gender gap in institutional investing found that only 9.1% of the CEOs and 6% of the chief investment officers of the largest institutional U.S. money managers were women as of Dec. 31, 2016, according to our most recent money manager survey. While the percentage of female CEOs has risen from 8.5% in 2011, the percentage of women in the CIO role dropped from 7.5%.
The gender gap appears more like a canyon. Our data also show the gap grows with seniority.
Women make up just 25% of executive employees and 40% of all employees at the 61 companies that entered P&I's 2017 Best Places to Work in Money Management program.
Data from the U.K.'s mandatory gender pay gap reporting this month found the pay gap in the asset management industry was wider than for the country as a whole. The average pay gap across asset management groups was 28.5%, with a bonus gap of 55.4%.
There is evidence from Morningstar, released in March, that funds with higher concentrations of female managers did better than funds run exclusively by men or by mixed gender groups and concluded "the low participation rate of women in the industry is not justified by performance."
Given that the active asset management industry is facing pressure from passive management and machine-driven trends, it is key that managers access the widest possible pool of human talent available. Diversity on management teams fosters diversity of ideas and approaches.
It is time to cultivate, hire, mentor, sponsor and train more women in asset management.