Alternative Asset Managers Are Making Progress on DEI Goals According to Latest Data from Jensen Partners

Jensen Partners Diversity Report shows meaningful strides toward gender parity in 2022, while gains in racial/ethnic representation remain slow

Jensen Partners, a leading global executive search and corporate advisory firm, has released key data that shows notable progress for alternative asset management firms who made commitments to diversity, equity, and inclusion (DEI) initiatives in 2022, particularly towards gender parity. 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.

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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 analyzes 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.

“The data we’ve tracked over the past year sends a clear message: DEI is not a moment – it’s a movement,” said Sasha Jensen, founder and CEO of Jensen Partners and Jensen DiversityMetrics. “Though progress looks different for various groups and gains have been uneven, we’ve witnessed a dramatic shift in attitude across the industry and there is more reason than ever to be optimistic that the DEI movement will continue to accelerate.”

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.

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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.

Today’s alternative investment firms are data-driven, relying heavily on key metrics to help inform nearly every business and investment decision. However, despite leveraging data to drive ideal business outcomes, firms continue to struggle with building and improving workforce diversity. To change this dynamic and to help asset managers instill the same rigorous approach to DEI that is applied to all other core business functions, Jensen Partners launched Jensen DiversityMetrics in 2021. Jensen DiversityMetrics is the cornerstone of Jensen Partners’ executive search and recruitment offerings. It utilizes the powerful combination of quantitative analytics and qualitative information to fuel the Jensen Diversity Pipeline Tracker, an on-demand diverse candidate pipeline of over 25,000 professionals across the asset management industry. With Jensen DiversityMetrics, firms can benchmark against competitors, source diverse talent, analyze hiring and retention practices, identify biases in workplace culture, and report progress to investors. The candidate pipeline has also enabled Jensen Partners to pledge that all future searches would begin with an initial candidate pool comprised of, at the least, 51% or more individuals from under-represented backgrounds. The pledge is based in the belief that the lack of diverse professionals across the industry is not the result of a lack of qualified candidates, but rather a systematic failure to hire them.

Jensen Partners regularly reports timely and crucial industry hiring and DEI trends to the public. The data and insight collected and distributed via Jensen Partners reports are leveraged by key players throughout the alternative asset management industry and help instill the level of accountability and transparency required to make steady, meaningful progress on critical challenges facing each and every asset class. The latest report offers updates to Jensen Partners’ 2021 findings and data, all of which demonstrate definitive proof of progress and initiatives that can help propel DEI forward for asset managers seeking to move the needle on substantial issues related to diversity and inclusion. The report also includes additional information on the role of salary, culture, and mentorship in building equitable workplaces.

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