Britain’s asset management industry has long had a reputation for being an old boys’ club for white men. Portfolio managers, one of the most prestigious positions in asset management companies, remain overwhelmingly male: one in 10 UK fund managers are female, while in the US only 184 of 7,000 mutual funds are run by women.
But — in an attempt to ensure more diverse recruitment in terms of gender, ethnicity, socio-economic background, sexual orientation and disability — several of the world’s largest asset managers have clubbed together to form the Diversity Project. This seeks to attract more women and minority recruits to the industry.
Senior industry executives see such work as critical for the industry to remain innovative. Unigestion, the Swiss asset manager, has increased its efforts to hire coders, technology specialists and graduates with PHDs across different disciplines. Fiona Frick, chief executive, says: “Diversity is essential for innovation, and for challenging the status quo. We want to hire candidates with diversity of perspectives, experiences, cultures, genders, and ages.”
One of the UK industry’s programmes is Investment2020, which aims to attract young people from a range of backgrounds after school or university.
The programme is backed by 28 asset managers, including Aberdeen, Jupiter and Schroders, and provides one-year traineeships to school-leavers and graduates.
Three-quarters of the trainees who completed placements received job offers from their employers. More than a third of the programme’s participants have been women, while 43 per cent have been from black, Asian or mixed-ethnic backgrounds. Less than a 10th were educated at private schools.
Karis Stander, managing director of Investment2020, says: “Attracting a diverse range of talent at entry level is vital for the future of the industry and will ultimately help companies have the diversity they need at a senior level.”
In the US market, Franklin Templeton, the Californian fund house, is involved in two initiatives to recruit more diverse candidates. This includes a work experience programme for female students from low-income homes at the Immaculate Conception Academy, a high school; and the Girls Who Invest programme, which provides female university students with six-week portfolio management internships.
Legg Mason, the Baltimore-based fund house, supports Bottom Line, a charitable organisation that provides mentoring for low-income college students. Employees raise money and provide one-on-one support to students to help them complete their university education. Some students have been interns and become employees at Legg Mason.
Companies are under pressure to make their leadership more diverse, in order to understand and reflect better their customers. When it comes to ethnic minorities, however, change is slow
But Colin McLean, founder of Edinburgh-based SVM Asset Management, says that industry internships remain scarce. He adds that there is no formal route into asset management. “Many [people] successfully enter in their late 20s or 30s after some experience in industry or gaining a professional qualification such as accounting.”
It is advantageous if entry-level graduates can demonstrate numerical and economic ability, although fund companies tend to be open-minded about hiring candidates from any academic discipline. In recent years, some graduates with degrees such as science or politics have carried out a one-year conversion course in finance in order to achieve “greater employability” in the US and the UK, Mr McLean adds. “The important thing is just to have good intellectual ability. Most [asset managers] would look for people from different backgrounds.”
For those seeking a career as a portfolio manager, many industry insiders recommend joining an asset management company in almost any role — from back-office teams such as legal, IT, compliance, press, marketing or sales — and showing a hunger to learn.
Ariel Bezalel began his career at Jupiter Fund Management in the UK aged 22, starting in the back office before rising through the ranks to run two large bond funds. “Read as much as you can. Being a fund manager is a bit like being a detective — you have to examine the evidence and question your views,” he says.
James Sullivan, a fund manager at Coram Asset Management in Bath, UK, agrees: “Being a fund manager is more than a job, it’s a lifestyle, and you have to fully immerse yourself. Don’t ever expect to be able to switch off.”