Despite a growing body of research suggesting that gender diversity has meaningful value and that mixed gender investment teams perform better than single sex ones, asset management remains dominated by men.

The statistics are truly shocking, at least to those outside of the industry. Only 9% of US open-end fund managers in the Morningstar database were women in 2015; 7% of UK retail funds are run by women, according to BestInvest; and women account for only 6.6% of Germany-domiciled fund managers, according to Fondsfrauen.

Moreover, recent figures from Board IQ suggest that less than 20% of fund managers have even one female board member. As MIFID II will introduce corporate governance rules that take in diversity, firms will be compelled to wake up to the reality of gender bias.

“Diversity brings concrete competitive and financial advantages. Companies that actively promote diversity and inclusion tend to outperform their peers by 15%,” said Sébastien Danloy, managing director, continental Europe and offshore at RBC Investor & Treasury Services.

Image problem

While asset management is certainly not alone in tackling bias, it faces an unusually severe public relations problem. Columbia Threadneedle’s Chris Wagstaff says the industry can often be mistaken for having questionable social value, inflexible working hours and being unforgiving of those taking a career break. This somewhat unfounded stereotype needs to be set straight if asset managers are to attract new types of talent.

As EdenTree Investment Management’s veteran fund manager Sue Round suggests, portfolio management may even be a more supportive environment than other financial services careers, such as investment banking: “Asset management can offer flexibility of roles and working hours, while client interaction tends to be more formal and there is less of an emphasis on after-hours events.”

Flexibility seems to be a key issue for women, who are more likely to take a break for maternity and family reasons if they are to more aggressively pursue their careers in the sector.

The financial industry seems to lag far behind others in developing a compelling flexible offering. Round concedes that at present it lacks the flexibility necessary to create a tempting proposition for people with differing needs. By adopting a more flexible approach, perhaps in the scheduling of hours or working from home, businesses may become more appealing.

State Street, which has close to 70% of employees, both men and women, participating in some form of flexible work arrangement, reports measurable benefits, including higher engagement, lower turnover and improved productivity.

A focus purely on the recruitment of women is unlikely to be enough to enact change as asset managers also need tackle diversity head on; developing awareness, creating priorities and committing to critical assessment and regular revision of strategy.

“It’s not enough to simply promote women,” says Kim Newell, head of State Street Global Markets. “For this to have a lasting impact and create sustainable change, we need a holistic approach to recruiting, promoting and developing a pipeline of female talent.”

Internal leadership programmes such as mentoring, which ensures that women are developing the requisite management skills, or sponsorship, which ensures that women have advocates further up in the organisation, can help enable women with leadership potential.

But as well as overt positive action, existing processes and standards need to be re-examined in order to have the best chance of creating a system that promotes equality. These range from tackling unconscious bias (such as assuming technical roles are inherently more suited to men and relationship ones for women) to ensuring that job descriptions are written in a neutral style and networking events are hosted outside of traditionally male-dominated domains such as the golf club.

The bold & the beautiful

The Association of Luxembourg Fund Industries’ chairman, Denise Voss, notes that women are less likely to put themselves forward for a job unless they meet the vast majority of criteria demanded of the role, as oppose to men who will put themselves forward if they meet 60% of the criteria.

Voss points to a recent TED talk by founder of Girls Who Code, Reshma Saujani, which suggests that where girls are socialised to be perfect, boys are socialised to be brave, which could result in women not taking risks: “Saujani calls upon women to be comfortable and be brave, to take risks. I like that, because I think that it is true. It’s obviously a very complicated topic.”

While no magic wand can be waved that will solve such subtle issues, it is clear is that achieving diversity across all societal groups, in terms of headcount and opportunity, needs a concerted and effort throughout the asset management industry.

“Top managers need to be involved and take ownership,” adds Danloy. “If that approach does not cascade through the organisation, it can be difficult to change the mind-set and culture.”