Spill the beans: An International Women's Day cuppa with Brie Williams, VP, Head of Practice Management, State Street Global Advisors
Brie, State Street Global Advisors (SSGA) has issued a call for more than 3,500 companies in which the firm invests - representing more than $30 trillion in market cap - to increase the number of women on their boards. This is welcome news, although it is interesting that investment management is a particularly tough industry for women and penetration at senior levels is still relatively low. Oliver Wyman, for example, found that it will take until 2048 to reach 30% female representation on executive committees in the financial services industry.
What do you think are the main reasons for the particularly low representation of women in the investment management industry?
Historically, within the financial industry, there has been a gender bias (whether it be conscious or unconscious) toward males in the workplace. However, there has certainly been a positive move from companies being accepting of diversity to actively promoting it. There has also been a great deal of work done through trade bodies, government initiatives and industry groups. All with good reason. Numerous studies have shown that companies with a strong culture of diversity and inclusion are more successful than companies that don’t.
Negative perceptions also need to be addressed, such as mistrust of the banking and investment industry fuelled by factors such as the crisis; alongside a general misconception that having a work/life balance, and being a working mother are difficult for a successful career in asset management. We need to enhance the industry's reputation among millennials from these misperceptions to nurture and developing a sustainable pipeline of female talent.
Whilst there is a lot of work to do, the industry is certainly on the right trajectory to achieving it.
To what extent would having more women in investment management roles and as executives at investment management companies lead to more sustainable long-term returns for investors?
We believe good governance is a function of sound board quality, which starts with strong, effective independent board leadership. By effective we mean having the right skills; by strong we mean the board’s ability to exert its influence; and by independent we mean that the board is not captive by management.
Board diversity enhances board quality as it brings together directors with different skills, backgrounds and expertise. For example, an MSCI study showed that companies with strong female leadership generated a return on equity of 10.1% per year versus 7.4% for those without such leadership, which is a 36.4% increase of average return on equity. We recognise that there are many ways to achieve board diversity and we support all forms of diversity, but as a starting point, we believe boards should have at least some independent female directors. Further, boards should also set expectations for senior management to enhance gender diversity within their ranks and the broader organization.
What is the ratio of women to men on SSGA's board?
We have 18 female Executive Vice Presidents (or 23% of population); 137 female senior vice presidents (or 28% of population). We have three board members who are female: Linda Hill, Amelia Fawcett and Lynn Dugle.
What proportion of SSGA's assets are managed by women?
More than half of SSGA’s assets, which exceed $2.5 trillion are managed under the leadership of Lynn Blake. Lori Heinel is also Deputy CIO and Chief Portfolio Strategist, just to name two.
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