Although diversification is “Investment Management 101,” the ranks of portfolio managers (PMs)—the people who manage your money—are undiversified. The usual suspects—a culture of harassment and work-life balance—do not apply here. IM has psycho-cultural barriers that subtly but effectively discourage women from entering and staying in the industry. This starts at the top; there are few senior women in the IM C-Suite. The lack of visible role models discourages students from considering it at the entry level. Once hired, barriers to retention and promotion lead to fewer women at the top...and the cycle repeats. With no knowledge of how to advance their careers, no explicit training, no “boys’ network” to help them in navigating their career tracks, and a lack of female leaders who could act as sponsors and mentors, women are at a disadvantage in an industry that lionizes confidence.
This book, written by two PM practitioners, provides an overview of active IM and the role of the PM for the layperson, an analysis of its lack of women at each point in the pipeline, and—most important—solutions to the imbalance. Drawing on a combination of primary and secondary research, interviews with close to 100 prospective, current and former industry practitioners (female and male), and our own experience, the book uses an analytical approach (worthy of an investment analyst!) to diagnosing and solving a problem not widely appreciated outside the industry, and brings numbers and data to life with anecdotes. Rather than designating a female “Warren Buffet,” we create a diverse “constellation” of successful PMs – our equivalent of a “North Star” that women considering or already in IM can look to as role models.
Our book takes care not to frame the lack of women in a negative light; rather than blaming the men who will be instrumental to change, we make the case for gender diversity in a time when active IM is facing structural challenges and margin pressure. Having more women PMs might lead to a revolution in active IM– and provide firms with a way to reverse passive market share gains.