When Paul Smith, CFA, president and CEO of CFA Institute, took to the podium at the 68th CFA Institute Annual Conference in Frankfurt, he looked out on a sea of men in dark suits.
It was a telling sign of a looming issue in the financial industry: a dearth of women, especially in the ranks of senior management. And it did not go unnoticed.
Smith told delegates that their reputations as investment professionals were tied to the reputations of the firms that employed them. And he said that to “effect change from the inside out,” it would require “building deeper relationships with senior levels of firm leadership.”
And by effecting change, he wasn’t simply talking about affirming ethical behavior and establishing trust or delivering the “clear message to investors and policymakers that we are a force for good, one that places the interest of investors above all else.”
He also meant effecting change when it comes to the number — and positions — of women in the financial industry.
“Our profession also has a diversity problem,” Smith said. “If we are to change we must also change our demographic. For too long, our profession has been dominated by middle-aged, middle-class men. Among the actions we should take, we need to hire and promote more women. Studies show that mixed gender teams bring much needed diversity of thinking to the investment process and improve investment outcomes. Further, women are poised to play a significant role in the global economy in the coming decade, with nearly one billion women who could enter the global work force in the coming decade.”
Smith went on to say that research and statistics highlight the importance of managing women’s wealth: they live longer, are responsible for more household financial decisions than ever before, and there are more women in the workplace generating personal income and retirement assets.
Several CFA societies are already hosting events targeted to women, and for the first time, CFA Institute is hosting the Women in Investment Management Conference in San Antonio, Texas, 2–3 June 2015.
— Lauren Foster (@laurenfosternyc) April 27, 2015
A group of women also met during the conference in Frankfurt to talk about initiatives taking place across various societies, as well as to exchange ideas and advice.
Marg Franklin, CFA, president of Marret Private Wealth Inc., a division of Marret Asset Management, stressed that the upcoming women’s conference in San Antonio should not be viewed as a “women’s” conference. “This is a diversity issue,” she said. (Franklin is co-chair — with Leah Bennett, CFA — of the advisory committee for the Women in Investment Management Conference.)
Franklin also stressed that boosting diversity is a Future of Finance initiative because the desired result is better investor outcomes.
One of the biggest challenges in the financial industry is how to retain female talent. It is not uncommon for women to work into their late 30s or early 40s and then exit the industry when the challenge of child-rearing and managing a demanding career become too much.
Franklin mentioned three phrases that relate to the women’s conference:
- “This is not a women’s issue,” she said, “it is a diversity issue.”
- “Our rallying cry,” she said, “is ‘lean down and yank up’.” She implored women at the luncheon to go out and find that woman in her 30s who is just about to leave the industry because she is feeling ground down, and to “yank her up and bring her to stuff she may not be exposed to.”
- “Visibility is validity,” she said. “It matters that you step up.”
Smith’s introductory remarks were headlined: “Let’s Make the World a Better Place for Investors.”
For more on this topic, see our recent forum on this topic: “The Gender Imbalance in Finance: How Do We Narrow the Gap?“
If you liked this post, consider subscribing to the CFA Institute Annual Conference blog.
All posts are the opinion of the author. As such, they should not be construed as investment advice, nor do the opinions expressed necessarily reflect the views of CFA Institute or the author’s employer.
Photo credit: W. Scott Mitchell