Milken Institute: Inclusive Capitalism | Corporate Compliance Insights

Strategies for Action in Asset Management

What’s in this report from the Milken Institute:

The low representation of women and BIPOC (Black, indigenous and people of color) individuals in the $86 trillion asset management industry is a barrier to efficient and optimal capital markets. Only 2% of asset managers are BIPOC, and demand for underrepresented groups in the institutional investment industry has accelerated. Investing in the American Dream is predicated on equitable representation in asset management and among decision-makers. Diversity, equity and inclusion (DEI) across the business community is critically important from the entry-level to the executive level.

A new report by the Milken Institute, “Inclusive Capitalism: Seven Strategies for Specific Action in Asset Management,” details actionable steps that can significantly benefit investing, emphasizing the power of recruiting from diverse educational institutions and the importance of implementing long-term mentorship programs. The report explores critical topics such as standardizing a governance diversity pledge and addressing access to diverse managers.

These proposed actions aim to increase diversity, capture unrealized value and mitigate long-term risks within the asset management sector.

Steps include:

• Redirect data and metrics on diversity
• Mentor and track employees from underrepresented groups
• Standardize a governance diversity pledge committed to addressing diversity in boards, companies and investment portfolios
• Intentionally convene with emerging asset managers and underrepresented asset managers