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Diversity, equity & inclusion practices in the investment management Industry: an evolving story
10th December 2021 / 5 mins read
Rachel Halpern
Head of Sustainability
Kirsten Temple
General Manager, Investment Strategy
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JANA considers that expansion of economic growth is underpinned by unlocking value from, and providing opportunities to, all segments of the community. In the investment management context, JANA considers that a diverse, inclusive culture provides a strong foundation for sustainable, high performing investment  organisations. This is also a growing area of focus for asset owners.  However, investment management as an industry is widely perceived to have room for improvement in embedding diversity, equity and inclusion practices. In order to aid widespread adoption of best practice, JANA recently undertook a detailed review of Diversity, Equity and Inclusion (DE&I) activities in the investment management industry. Covering over 150 investment managers globally, the information provided has given us great insight into the evolution of DE&I practices. 

Over 70% of respondents confirmed that they have a DE&I (or equivalent) policy in place. This is expected to grow, with many others indicating that they are currently formulating a policy. 

1. DEI
Common Practice

Just as having a DE&I policy is becoming common practice, JANA found that some practices that can help support a diverse and inclusive workforce were commonplace globally. These included internal training on DE&I, flexible working arrangements and employee benefits like parental leave. However, we found that the more explicit measures organisations could take were far less common.

2. DEI
Australia and New Zealand lag other regions

Respondents that are headquartered in Australia and New Zealand were less likely to have a DE&I policy in place than respondents headquartered in other regions.

2. DEI

They were also less likely to have implemented policies and practices that are intended to support a diverse and inclusive workplace, with Australia and New Zealand based organisations having a lower rate of implementation of all DE&I practices covered by our analysis.

4. DEI
Size Matters

Unsurprisingly, JANA found significant differences in policies and practices based on organisational size, as defined by the number of employees. 

Larger organisations typically adopted a broad range of measures to support a diverse and inclusive workplace. This was particularly noticeable when considering practices that explicitly seek to promote a diverse workforce.

5. DEI

Training on DE&I issues was widespread, although the practice of providing specific training for managers and other senior leaders was again more common amongst larger organisations than smaller ones. 

6. DEI

There was less difference based on organisational size for provision of flexible working arrangements and employee benefits, such as parental and carers leave.

7. DEI
Publicly Listed companies appear to do more 

We had expected that publicly listed companies would have more advanced DE&I practices than their privately held counterparts on account of greater external scrutiny and pressure from shareholders. While this was the case, the size of the organisation appeared to be a greater determining factor, with greater presence of DE&I policies and practices in organisations with more than 500 employees than in the publicly listed company universe. This may be driven by greater available resources to implement DE&I practices and the need to do more to attract and retain talent. 

8. DEI

Pleasingly, we have observed that the focus of the investment management industry on DE&I practices have grown substantially in recent years, such that the presence of policies has become common place. However, policies in and of themselves are not a quick fix and do not necessarily result in improvement of outcomes without an accompanying cultural shift. This takes time and the ownership and employee statistics provided as part of this exercise do show a lack of diversity, by gender, ethnicity and age, reflecting the substantial work still to be done. 

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