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Many more Daves than Dianas in funds management

by Alexandra Cain | 11 Mar 2020
There are more Daves and Davids running UK management funds than the total number run by women - and diversity in the sector is worse in Australia, according to new research.

The report, Women in Investing: Morningstar's View, updates figures first published in 2016, drawing on data from 25,000 fund managers working across 56 countries.  

The report indicates in the UK there are 108 funds run by men called David or Dave, while only 105 funds run by women of any name.

The research has found only 12 per cent of fund managers in Australia are women. This compares with the global figure of 14 per cent. 

But at least Australia is doing better than the US, where only 11 per cent of fund managers are women. The figure for the UK is 13 per cent.

It’s disappointing Morningstar’s data shows a decline in the percentage of women working in some areas of funds management. Back in 2000, women made up 13.4 per cent of women in active funds management and 19.43 per cent of women in passive funds management. By 2019 these figures had dropped to 10.69 per cent and 13.23 per cent respectively. 

It’s a similar story when the numbers are cut for equity and fixed interest managers. In 2000 women made up 12.89 per cent of people working in equities and 15.97 per cent of people in fixed interest funds management. By last year these numbers had dropped back to 10.84 per cent for equities and 11.35 per cent for fixed interest managers.  

Morningstar says structural barriers and implicit biases are to blame for the dearth of women in funds management.

Yolanda Beattie of Future IM/Pact says the problem starts at a graduate level. Future IM/Pact aims to attract more diverse talent to super funds and fund managers, with a focus on university students. 

“Despite Australia’s large and thriving investment and superannuation sector, many of our most talented female university students do not consider professional investing as a career option,” says Beattie. 

Find out more about our webinar on Diversity, Progression and Women in Leadership

“Our research shows female finance students are almost 50 per cent less likely than their male counterparts to consider a career in investments. This is mostly because they don’t know enough about it or feel they won’t fit in. If we want to change this we need to tackle some of the barriers to entry and create barriers to exit,” she says.

Jen Dalitz, CEO of industry group Women in Banking and Finance, says Morningstar’s study highlights many interconnected problems for women in investment management.

“This includes addressing biases in recruitment, which are inherent when women have such a minority presence,” says Dalitz.

“It’s also important to provide access to mentoring and sponsorship opportunities. We also need more flexible work practices to help women navigate their career through different life stages,” she adds. 

Dalitz says an ingrained culture of sexism and gender discrimination and stereotypical views about women being inferior to men, lacking intelligence and best suited to administrative roles need to be addressed.

Diversity must be championed from the top-down, says Louise Watson, managing director and head of distribution for Natixis Investment Managers in Australia. 

“Leaders need to encourage informal flexibility. The term work life balance no longer applies. Men and women should be trusted to manage their day and work load,” she adds.

The lack of diversity in funds management has a financial cost. A study by the Credit Suisse Research Institute suggests a company’s financial performance improves when there are women in the boardroom and C-suite. But its data also shows how few women work in the upper echelons of the corporate world. 

According to the research, published last year, women make up only 17 per cent of managers and 20 per cent of board members. But at least the gender balance is improving. Ten years ago, women made up only 10 per cent of board members. 

The figures are not as impressive in management, with this number only rising from 14 per cent a decade ago. But as women move higher up the management chain, the fewer there are. Credit Suisse’s numbers show only five per cent of CEOs and 15 per cent of CFOs are women. It’s an imbalance that needs addressing urgently. 

Find out more about our webinar on Diversity, Progression and Women in Leadership


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