Every August, the conversation about gender equality tends to settle into familiar territory: representation, fairness and doing the right thing. Of course, this all matters, but in asset management, there is another more practical argument that too often gets left out of the Women's Month conversation, which is ironic given that it is an industry built on identifying where value is being overlooked.
Put simply, it is the argument that underpins the bottom line – the investment case that highlights that gender parity in asset management is not a diversity statistic, but rather a mispriced risk and an underexploited source of potential return.
The industry that manages everyone's money is run by a narrow slice of it
Globally, women hold roughly 12% of portfolio manager roles, a figure that has barely budged in two decades despite the industry more than doubling in size over this period. Fewer than one in five analyst and executive roles in asset management are held by women, who also only hold single-digit percentages of chief investment officer seats. The result of this is a stark structural reality – that the risk frameworks and capital allocation decisions that shape trillions in savings around the world are still being designed and approved by a homogenous group of men.
This matters commercially, not just symbolically. Research across fund performance data consistently shows female-led and gender-diverse investment teams matching or outperforming their peers, often while taking on different risk exposures. Studies of private equity and venture capital have found gender-balanced senior investment teams delivering meaningfully higher returns than their less diverse counterparts. None of this means women are inherently better investors. It means diverse teams tend to make different assumptions and stress-test ideas alternatively, as well as being less prone to the herd mentality that has been at the centre of several of the industry's costliest failures.
The cost of underinvesting in gender parity is not abstract
Economists have been quantifying the opportunity cost of gender inequality for years, and the numbers are large enough to have meaningful implications for the industry. The McKinsey Global Institute has estimated that narrowing gender gaps could add between $12 trillion and $28 trillion to global GDP. Closer to home, research modelling the impact of closing gender participation gaps across Africa points to tens of billions of dollars in unrealised GDP by the end of this decade – driven not by charity, but by the basic economics of underused human capital.
Asset managers play a unique role in this issue. We are simultaneously part of the problem – an industry with one of the more persistent gender gaps in professional leadership – and one of the few industries with the scale to influence the outcome, through hiring practices, investment decision-making appointments, and the companies we choose to back with our clients' capital.
Allocators are starting to notice
Institutional investors such as retirement funds and family offices are asset owners with long memories and longer time horizons, and they are beginning to treat gender composition in investment teams the way they already treat concentration risk or governance quality: as a factor worth considering before committing capital. An allocator who ignores the gender composition of the teams managing their money is not being neutral. They are quietly accepting a narrower set of assumptions and a smaller pool of talent than the market actually has to offer.
This is the shift that asset managers have to make. Treating gender parity as an internal human resources target to viewing it as an investment variable on both sides of the balance sheet can be achieved through how we build our own investment teams and how we assess the leadership of the companies we invest in on our clients' behalf.
Where this leaves us
Women's Month is a useful moment to say the unsaid; to elevate an asset manager to achieve optimal returns, gender equality needs to be viewed through the lens of a performance, risk and capital allocation argument, which is a language that investors should be best placed to understand.
At Old Mutual Investment Group, we see this as core to how we think about long-term value creation – for the teams that manage our clients' money, and for the businesses that money ultimately flows into. Old Mutual Investment Group is the leading large asset manager on diversity, equity, and inclusion (DEI) in South Africa, having been identified as the most transformed asset manager above R100 billion by 27Four DEInvest Survey for the last two years since the awards’ inception. Our investment leadership is primarily composed of female investment professionals such as Bernisha Lala (Head of Indexation), Funeka Maseko (Head of Fundamental Equity Research) and Leanne Micklewood (Head of Quantitative Research), as well as senior portfolio managers such as Meryl Pick. Externally, funds such as the Old Mutual Global ESG Equity Portfolio and the Old Mutual African Frontiers Fund employ a gender lens, prioritising companies with significant women leadership at the board level to foster both financial returns and community upliftment.
Closing the gender gap in asset management, and indeed the broader corporate world, will not happen through one campaign or one appointment. It happens through consistently treating diverse investment judgement as the asset it demonstrably is – and pricing the cost of ignoring it accordingly. The more interesting question now is what changes once more of us start acting on the evidence.