Firms that look to the future see it paying dividends today

Firms with a strong corporate culture often share a commitment to being nimble and progressive as the asset management industry evolves as well as diverse and inclusive, and collaborative in nature — all factors that help employees feel like they can thrive and contribute to their organizations, industry sources said.

Of note, firms with healthy cultures typically have forward-looking senior management, who are not only anticipating market shifts and economic trends, but "how their firm will exist in the future," and how it will "maintain its competitive advantage, and be the right place to deliver desired outcomes to their clients," said Luba Nikulina, managing director and global head of research, investments, at investment consultant Willis Towers Watson PLC, London.

To this point, Jim Cooper, managing partner of executive search and management consulting firm Concentriq LLC in Wenham, Mass., said that the best places to work in the industry usually offer "clear visibility into an individual's professional growth potential," including paths to management-level roles.

Additionally, top talent wants insight on how the firm intends to grow, despite headwinds like fee pressures and compressed margins, Mr. Cooper said.

Among the 76 firms named on Pensions & Investments' 2019 Best Places to Work in Money Management list, on average, 87% of employees agreed in an annual benchmark survey that they had a good understanding of how their organization was doing financially.

When making a job move, candidates are also looking for firms with a management team that is engaged and willing to listen tonew investment and non-investment-related ideas, Mr. Cooper said.

He pointed out that candidates are, conversely, most unhappy or considering a potential role change at organizations "where they feel their ideas aren't being heard."

At alternative asset manager Blackstone Group Inc., New York, a major factor that has contributed to its strong sense of culture is its meritocracy, said Jonathan Gray, president and chief operating officer. This has, in turn, allowed many young people over the years to be able to move up in ranks in the company, himself included.

"Many of the senior leaders started here in their 20s as analysts. I myself started as a first-year analyst straight out of college," he added.

Blackstone ranked No. 1 in the super employer category (those with 1,000 or more U.S. employees) on the Best Places to Work list, which it has made six times.

"There is a well-worn path at Blackstone of young people who have come here and been able to ascend to roles in leadership," Mr. Gray said.

T. Rowe Price Group, Baltimore, has found that a good corporate culture is "one of the biggest predictors of success" for companies, said Robert W. Sharps, head of investments and group chief investment officer.

This is true of stock-picking, but also in weighing the prospects that a money manager has to offer, particularly since asset management is a talent-driven business, he said.

"Some of the best investments I've made had some of the best company cultures," Mr. Sharps said. "(Employees) have to be at a place where they love to come to work and feel like they are being challenged."

T. Rowe ranked No. 4 in the super employer category on the Best Places to Work list, which it has made three times.

One way the firm aims to instill a good sense of culture is by encouraging collaboration within its investment teams, Mr. Sharps said.

In the coming weeks, portfolio managers and research analysts will go on a "field trip" to Silicon Valley and meet with companies that may or may not be in their own investment portfolio.

"It may be a company they could own in the future or a company they don't have any intention of owning," but investment staff can learn something new about a sector or similar company they are investing in, Mr. Sharps said.

Field trips such as this help foster collaboration, and "collaboration is key in a field as intensely competitive as asset management," he said.

"Competitive intensity can result in people really being much more focused on their own set of responsibilities. While we are absolutely driven to succeed, there's a real sense that the competition is outside of the organization," and not within it, Mr. Sharps said.

As asset managers are faced with a myriad of headwinds today, a strong organizational culture can also help provide a sense of stability, even in troubled markets or times of duress, another source said.

Founded in 2001, Causeway Capital Management LLC, Los Angeles, has seen its share of market ups and downs, none more memorable than the stock market collapse of 2008, said Sarah Ketterer, CEO, co-founder and portfolio manager at the firm. Causeway is a newcomer to the Best Places to Work program, and ranked No. 4 in the large employer category (firms with 100 to 499 U.S. employees).

"As markets collapsed, our assets under management also fell very precipitously," she said. But during that time, "we had great cohesion even though there couldn't have been more uncertainty," Ms. Ketterer said of the firm.

To help prospective hires get a better understanding of the firm, MRA Associates, a Phoenix-based firm that provides investment advice and wealth management services, allots time during the hiring process to have a dedicated discussion about the company's culture with job candidates, Will Froelich, a partner at the firm, said.

2019 marks the fourth year that MRA Associates has ranked as a best place to work.

MRA Associates also strives to show that it prioritizes culture by investing in its talent.

Currently, "20% of the firm's profits are reinvested back into employees via bonuses," according to Mark Feldman, managing partner and CEO. "We're also very clear that people have a shot of becoming owners in the firm over time, and we are very clear in our career pathing around that," he said.

AQR Capital Management LLC, Greenwich, Conn., also makes efforts to "expose potential recruits to every aspect of (its) culture through deep engagement," Jen Frost, principal and chief human resources officer, said in emailed comments.

All prospective hires go through a dedicated interview that focuses on the company's values, and the discussions help job candidates visualize themselves at AQR, she added. The firm ranked No. 2 among major employers (firms with 500 to 999 U.S. employees) on the Best Places to Work list, and has now made the list three times.

Willis Towers Watson's Ms. Nikulina has seen that another trend among money managers with strong organizational cultures is the move away from a star portfolio manager culture.

"We can see how those organizations, that think about their longer-term success and future, emphasize much more a team approach," she said.

Harbert Management Corp., a Birmingham, Ala.-based alternative asset manager with about 140 U.S. employees, has strived to build a team environment that supports long-term intellectual curiosity — which "leads to success within our organization," said J. Travis Pritchett, senior vice president and global head of real assets.

The firm is a newcomer to the Best Places to Work program.

While not a money manager, Strategic Retirement Partners, a Shorewood, Ill.-based retirement plan consulting services firm and newcomer to the Best Places to Work list, also sees the value in tapping into all of its talent at the organization.

In fact, Jeffrey Cullen, co-founder and managing partner at SRP, has found that retirement plan consultants typically, "have a figurehead who dominates the conversation, innovation and day-to-day of what goes on within the organization."

"We didn't want anything to do with that," Mr. Cullen said of the trend.

The firm, which ranked No. 2 in the small employer category (firms with 20 to 49 U.S. employees), has taken measures to make sure its employees contribute their ideas across the business, by having them join "advisory groups," which SRP created for all of the functional areas of the business — from IT, to consulting, sales and marketing, he said.

While on an advisory group, employees serve as subject matter experts, based on their interests and not necessarily on their role within the organization, Mr. Cullen said.

Another important aspect of building a strong, healthy culture is improving diversity and inclusion, sources say.

At Causeway, one of its first goals within this arena was to "get more women in every single role that we have," Ms. Ketterer said.

Today, women make up 75% of the company's board, 14% of its investment professionals and 34% of its 100-plus workforce, she said.

Diversity is also beneficial to clients; it shows that "we don't all think alike," Ms. Ketterer said.

"Part of our need for diversity is to bring people into the organization, particularly investment staff who come from different parts of the world and have the perspective of where they come from," Ms. Ketterer added.

To this point, Mary Ellen Stanek, managing director, chief investment officer of Baird Advisors, the fixed-income team of Baird Asset Management, and president of Baird Funds, said: "Asset management is really a business about managing risk carefully and appropriately. We look at having inclusive and diverse portfolio management teams as an advantage to our investors."

Baird Asset Management ranked No. 5 among medium employers on this year's list (firms with 50 to 99 U.S. employees), and has been named a best place to work every year since the program began in 2012.

Among the 76 firms named in the program, on average, 91% of employees agreed in the program's annual survey that their employer enables a culture of diversity.

Another firm, GuideStone Capital Management LLC, Dallas, which focuses on faith-based investing and is a newcomer to the Best Places to Work list, has pushed for inclusion that goes beyond just the gender and racial makeup of staff.

David S. Spika, president of GuideStone, said in recent years the firm has been "very intentional about finding people from various walks of life (as well as) outside of Texas," and not just from a Southern Baptist background, which historically had been the case, given the firm's work with clients in this denomination.

"The firm has really benefited from hiring people from different areas," Mr. Spika said.