Despite the scrutiny placed on sexual harassment in the workplace by the #MeToo movement, most investors are not asking money managers about their record on this issue, the results of a survey released Friday by the Investment Management Due Diligence Association show.
Just over a quarter, or 26%, of the 78 due diligence officers from institutional investors surveyed by IMDDA said they specifically ask money managers about the firm's record of sexual harassment compared to 11% in the organization's 2018 survey.
Of the balance, 71% of respondents said they don't inquire about sexual misconduct compared to 89% in the previous year's survey. In response to a new question in the 2019 survey, 4% of respondents said the issue isn't important.
In its report, IMDDA researchers said the results of the 2019 survey "spotlight the disturbing trend of how leading ... investors and allocators are failing to fully address sexual harassment at fund management firms they wish to employ."
Further, the report's authors said the risks of ignoring sexual harassment within money management firms for institutional investors include reputational damage, negative media coverage, protests by beneficiaries, actions by investment committees and charges that personnel did not perform adequate due diligence.