Contribution - Alfi

Advancing diversity in the North American fund industry

Jim Fitzpatrick, president and CEO de Nicsa. (Photo: LaLa La Photo)

Jim Fitzpatrick, president and CEO de Nicsa. (Photo: LaLa La Photo)

As asset management professionals looking to best support the distribution of our products and services, we have to understand who our clients are and ask ourselves if the industry’s workforce is reflective of the society we serve.

This question has begun to take a solid foothold in the minds of senior executives searching for ways to drive innovation and spark creative client solutions.

In late 2018, NICSA launched the Diversity Project North America, an initiative aimed at tackling the issue from a top-down and strategic business perspective. The program spans across companies with the mission of accelerating a more inclusive culture within the global asset management industry.

Diversity of ideas and approaches makes for higher-performing organisations and promotes long-term business sustainability.
Jim Fitzpatrick

Jim Fitzpatrick,  president and CEO,  Nicsa

NICSA aims to accomplish this goal through collaborative leadership among senior business leaders who control headcount and budgets and that have the power to solicit and effect change within their organisations. To date, the Diversity Project North America has onboarded over 30 firms (with more on the way) that demonstrate a keen interest in moving the needle in a positive direction on this critically important issue.

Diversity of ideas and approaches makes for higher-performing organisations and promotes long-term business sustainability. Our message to all asset management industry participants is that, if you have not already done so, it is time to move into execution mode. NICSA’s Diversity Project is hoping to help firms do this by engaging high-level executives in order to provide our members with concrete, actionable best practices at both the firm and industry levels.

Challenges ahead

One significant challenge to success is that too many executives and business leaders across the industry see diversity and inclusion as an initiative executed by the human resources side of their organisations. Much of the Diversity Project North America’s efforts are aimed at setting an example for how business leaders can own the diversity issue, in conjunction with HR, and embed inclusion into the day-to-day fabric of how they run their businesses.

Another challenge facing the asset management industry is the historical brand reputation of a community largely run by white males. The reality is that, while we certainly have our work cut out for us on the D&I front, the industry offers an incredibly diverse set of opportunities for people of all backgrounds regardless of gender, race, orientation, or educational background; and whether their interests lie in portfolio management, sales & distribution, technology, operations, risk management, data science, artificial intelligence, etc. As an industry, we have the opportunity to engage more robustly with those entering the workforce to highlight the opportunity set that this industry provides.

Reaping the rewards

In building the business case for diversity, one can look to a couple of corner-stone ideals: (1) the development of an operating model that is conducive to idea sharing; and (2) the optimisation of an organisation’s ability to harness creativity. The effectiveness of that operating model design – as it relates to collaboration – can be greatly impacted by the diversity of the workforce. For this reason, D&I should be at the top of asset managers’ minds as they face a fiercely competitive environment that rewards innovation with asset growth and brand loyalty.

Looking ahead

Distribution executives worldwide have been acutely focused on addressing key trends and challenges resulting from evolving business environments that include issues such as intermediary partnerships, fee compression, shelf space, tech-inspired client services, product structure, and data analytics, to name a few.

NICSA is focused on serving members across all facets of the industry to advance the exchange of information on these key themes. As investors’ needs evolve, so does our association. That is why we will continue to deepen our voice in the growing D&I conversation. Join us at #DiversityProjectNorthAmerica.

More news on the fund industry in  Paperjam’s Alfi  supplement.