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Alternative asset managers are making progress on DEI goals, says Jensen Partners

Alternative asset management firms who made commitments to diversity, equity, and inclusion initiatives in 2022, particularly towards gender parity, have made ‘notable progress’, according to a new report from executive search and corporate advisory firm Jensen Partners.

Alternative asset management firms who made commitments to diversity, equity, and inclusion (DEI) initiatives in 2022, particularly towards gender parity, have made ‘notable progress’, according to a new report from executive search and corporate advisory firm Jensen Partners.

The report indicates that major hiring initiatives have increased the ratio of men to women to over 44%, though progress for racial/ethnic representation lags.

The 2022 Diversity Report, A Movement Takes Shape, is informed by data from Jensen DiversityMetrics, the first enterprise software platform that combines self-reported diversity data and human capital management technology specifically designed to enable asset managers to measure, report, and improve talent management. The report analyses gender parity rates, racial/ethnic composition, and intersectional seniority across alternative asset classes through data tracked from May 2020 to September 2022, revealing progress that is representative of a lasting movement rather than a waning moment.

As increased pressure is placed on managers to ensure that their investment teams are representative of those who they invest on behalf of, firms have begun to act on strategic DEI initiatives to remain competitive. The commitments that were made in 2020 are beginning to reveal signs of a change towards sweeping advancements for an industry historically dominated by White males.

Across the private credit, private equity, and hedge fund industries, women now represent 44.29%, 44.89%, and 45.38% of marketing and distribution professionals respectively, according to data collected in September 2022. Jensen Partners also tracked a nearly 50% increase in women hired in 2021 versus the same period in 2020, making the overall gender ratio across alternatives 40-50%. Additionally, 42.7% of female moves were concentrated at senior levels compared to 37.8% of moves in 2020.

Racial/ethnic diversity has seen slower growth across asset classes in comparison to gender. When evaluating racial representation, White professionals still account for 70-80% of employees across roles and asset classes, representing slower and uneven progress for different racial/ethnic groups. Women of color continue to be disproportionately disadvantaged regarding both representation and level of seniority. As the data illustrates, 84% of Black women in private equity distribution roles hold junior-level positions. In Q1 2022, the hiring of Black marketing professionals fell to 2.47% of all hires, which is a decrease of 20.06% from Q1 2021. In the same period, Hispanic/Latinx professionals experienced a 314.29% increase in moves. Firms must continue implementing comprehensive DEI strategies and initiatives to make progress for racial/ethnic minorities across asset classes and roles evenly distributed.

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