Institutional investors have a new forum for discussing ways to increase diversity in their investment decisions and in their own organizations.
Investment consultant NEPC's Investment Diversity Advisory Council, an open forum, "will allow us to engage with our clients directly in conversations that help all stakeholders — including our firm — expand our definitions of diversity and continually improve the measurement benchmarks we use to track our collective progress," said Samuel M. Austin III, an NEPC partner who chairs its diversity and inclusion board and co-chairs NEPC's diverse manager committee.
NEPC has $32 billion of client assets invested with diverse firms and nearly 40% of firm clients use diverse managers across public and private equities, hedge funds, private debt and private real estate.
The Investment Diversity Advisory Council is part of a broader NEPC effort to fulfill data-driven goals of a diverse managers policy announced in 2019. To reach the primary goal of having diverse managers represent 10% of NEPC's focused placement managers list by 2021, the firm has committed to a 10% increase in meetings with diverse firms in 2020, and to provide feedback to those firms within three months.
NEPC held a pilot forum in February with 10 self-selected public fund clients discussing short- and long-term goals for increasing diversity in boardrooms, vendor lists, workforces and investment manager selection processes. Tom Tull, chief investment officer of the $29.1 billion Employees Retirement System of Texas, Austin, said officials there enjoyed being part of the pilot and look forward to working with NEPC on diversity initiatives.
"Diversity is a key focus area for our organization," Mr. Tull said. The Investment Diversity Advisory Council "was something that immediately resonated with our leadership team," said Sean Bill, CIO at Santa Clara Valley Transportation Authority, which has a diverse workforce and board.
The next forum will be held at NEPC's annual client conference May 20 in Boston.