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Where are the women money managers?

It’s a global question.
Girls are among the best performers at school and university, but that success does not translate into equivalent success in the workplace. However, this may be changing – not because of women, but because men are shifting the game. Picture: Shutterstock

When investment guru Charles Ellis visited South Africa last year, he began his presentation by making an observation. It was obvious to him, he said, that he was speaking to a room full of investment professionals because there were almost no women present.

South Africa isn’t unique in this. It’s something he sees all over the world, and something he believes the industry should be questioning.

Why is it that asset management remains so dominated by men, particularly in investment decision-making roles? And why has it been this way for decades?

The shift that never happened

Nicola Ralston, formerly head of global investments at Schroders and now a director of PiRho Investment Consulting in the UK, says that when she entered the industry more than 40 years ago it was not a common career choice for women, but she thought this would change with time.

“A generation earlier women typically didn’t go into professional jobs, but I thought that in 40 years things would naturally have changed,” Ralston says. “Yet, here we are and very little has changed.”

She does not believe that there are many more women in senior investment decision-making roles than there were when she started.

“Everywhere I go I see women in every other job at a top level in the investment value chain,” says Delphine Govender, chief investment officer at Perpetua Investment Managers. “But I see almost no women as chief investment officers or portfolio managers.”

The obvious question is why this is, particularly since there is no objective reason why women shouldn’t succeed as fund managers. There are currently as many women as men qualifying with appropriate degrees, and many are joining firms as junior analysts.

“So where is the breakdown?” Govender asks. “Because the job is about intellect. It’s also objectively managed. If you recommend a share, does your investment case turn out to be true? The numbers will tell you.”

Real women

Govender believes it can partly be explained by the fact that there are cultural factors in the industry that many women struggle with.

“Girls are among the best performers at school and university, but that success does not translate into equivalent success in the workplace,” she says. “I think that’s because investing is unusual in that perceived success is measured in your ability to express your opinion. Often girls are raised to not speak up until they believe they have the full game plan. They’re good at exams because there is an exact answer, but investing doesn’t work that way. The best money managers in the world only get six out of 10 decisions right.”

The industry has also traditionally valued a killer instinct – a ruthless desire to succeed, typically at the expense of someone else. There’s little reason to believe that this is, in fact, beneficial, but it is prevalent. And again, Govender points out, it is not often a natural fit for women.

“When women come to an environment like this, where the belief is that what motivates people is the pursuit of profile, power and money, they often look at it and say: ‘How much of my real me do I have to suppress so that I can nurture the me that needs to be recognised?’”

Stepping off the escalator

The demands of a high-pressure job managing other people’s money also have to be weighed against other lifestyle choices.

“I think there is undoubtedly, in your mid-career, a point when you have to make choices around lifestyle and family,” says Jeanette Marais, CEO of Momentum Investments. “You realise that it is almost impossible to have everything. Daily, I see how my female colleagues struggle with it.”

Ralston believes this struggle has had a profound effect on how many women progress in the industry.

“What I see is women who develop good careers, who still want careers, but because of their own lifestyle needs, have changed the way they work,” she says. “They have moved away from front-line roles to support roles, from working full time to working part-time, have taken long periods away from work, or gone to other jobs that are more flexible.”

Effectively, this means that they take themselves out of the running for the top jobs.

“It’s not because firms discriminate against them in general, but the way firms expect those roles to be filled and the lifestyle that comes with them is unappealing,” Ralston explains.

The dilemma this raises for the industry is obvious.

The shift that is happening

“What I find fascinating is that in MMI, which is a big organisation, 50% of employees are female,” Marais says. “But the moment you get to senior management and higher, that percentage goes to the lower teens. It’s something we have to be deliberate about. We have to have a plan to bring women through. It won’t happen by itself.”

As the CEO of her organisation, Marais is obviously in a position to be able to do that, since she understands intimately what is required. However, in the broader industry, this isn’t the case. If women aren’t progressing to senior positions, who is going to change the culture?

Ralston believes the answer probably lies in reframing the problem, and not seeing it as one just about women.

“Ironically, I think the change will come because men begin to realise that the environment isn’t working for them either,” she says.

The demands of the job may always be there, but the ego-driven culture that has shaped the way the industry works for decades is shifting.

“Men now also want flexible time, to be able to pick up their kids from school, and to be able to work from home,” says Govender. “So I think the funny thing is that men are going to change the culture because they are more in touch with what they want from their lives. The environment and cultures are becoming more enabling because they want this dimensional balance for themselves.”

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Funny how people like Charles Ellis or commentators bring up this global issue in the west and label it a “problem”. No one is ever in Abu Dabi, Dubai, Riyadh, Kuwait City or even the east like Tokyo or Bejieng labeling lack of female representation a “problem”. Do these people view non-western cultures gender demographics “problems”? Just something interesting iv noticed while doing business globally. People are awfully quiet about these problems when doing business in the middle east and China. Don’t even get me started on eastern trade shows where the only women on the premises are Asian or Russian girls in bikinis. This might sound rough but women in the west should be thankful that their very existence is even acknowledged let alone given jobs in investment decision making. Something we can be proud of in the WEST. Anecdotal rant over.

Westerners are hell-bent on the idea of everybody being equally well suited to every kind of work. That is just not so. Differing genetics result in different skill sets. Men are better soldiers. Women are better nurses (why is there no outcry over the shortage of male nurses?). Men are better suited to being computer geeks and financial wizards. Women dominate the world of grade-school teaching. It’s in the genes. Get used to it.

Women in general refuse to put in the hours most men will to succeed at higher end jobs. It is reflected in the mythical “pay gap” that feminists and low-information journalists keep throwing up to somehow prove that women in the West are oppressed. This article at least reinforces the real truth – there is no “patriarchy”, just people who refuse to accept the consequences of their own life choices.

” It’s something we have to be deliberate about. We have to have a plan to bring women through. It won’t happen by itself.”

So, I’m assuming they gonna FORCE the numbers through.. ( -_-)’

YAY equality of OUTCOME and BOOO equality of OPPORTUNITY!

Stupid question.

Why aren’t there more female firefighters? Why aren’t there more male midwives?

This article is by far the most attention-seeking article ever written by Moneyweb.

Write about real economic-related issues. Thank you.

Its not that girls are raised not to speak up. It more to do with having a holistic approach to life and caring about the outcome of ones actions. Fund management is a narrow game of greed and making money.

There is a plethora of academic research conducted on this topic.

The article seems to say that women choose to not go into these senior roles because they want better work-life balance. I think we should respect women by letting them make that decision for themselves and not force them to go into senior roles they clearly don’t want.

Here’s my question: What is stopping woman from entering the field and progressing towards such roles? Nothing seems obvious to me but the implication is that this (disproportionately low number of female portfolio managers) is some kind of male conspiracy. The reality, which people seem to ignore, is that finance and portfolio management as a career around the world seems to appeal to males more than females. I don’t see that many men in hairdressing and could take the same ‘woe is me’ approach from a male perspective i.e. please make hairdressing more appealing to males.

I fully agree with all of the comments on freedom of choice.

One thing with fund management is akin to gambling. There is a detailed survey (close to 50000 Americans) showing that pathological gambling is on the rise for both women and men. It has also been proven that women and men gravitate toward different forms of gambling – women prefer stock markets while men are more open and head for the casino.

There is also a disproportionate number of men in prison compared to women. If we are only looking for equality of outcome, why shouldn’t we be calling for equal representation in prisons?

Women are silently running the world inspite of attempts to effeminate them!
No way David Cameron could have withstood the heat that Theresa May has faced over Brexit. Couldn’t even go the first round!
And Magda’s share price has recovered a lot faster than most on the JSE in the last year!

The Asset Management industry..what I see most of the time is women in the operations/support roles as opposed to investment management and analysis roles.

What I also see is clear absence of black people anywhere in Asset Management except within the Banks.

There is value to be derived from diversity.

As a father of two bright (IMO) daughters, I would echo the sentiment. Women are far less driven by ego than men. Ego and CIO are a very bad combo. There is an old story about heavy water production in WW2. Basically, supervising the process required keeping a dial between say 3 and 8. Male operators started a game about who could go closest to the edges and come back fastest. Female operators kept the dial at 5 and read books. Massive difference in heavy water production.

Example, with the exception of Thatcher, I doubt countries led by women have gone into stupid wars. Wars have been fought about women but rarely instigated by women – Think Helen. In the business world, some women CEO have overseen FUBAR situations, so not failure-proof.

The world would probably be better off if all leaders were women? But be careful of women trying to be / beat men…

When countries are lead by women the following bad things tend to happen:
1. Women are more nurturing, so they open the borders to all the “needy” foreigners (See Angela Merkel in Germany)
2. This increase in needy people puts enormous strain on the public purse.
3. Women leaders also tend to be left leaning and hand out benefits like candy, bankrupting the state.

It is not about representation. It is about recognising the value of a diverse collection of individuals and the different perspectives and ideas that they bring. The typical ‘boys club’ will not do that.

After reading this article it appears that the only barrier prohibiting woman from becoming money managers is the internal turmoil they have within themselves regarding time available and how best to utilize it.

Did anyone take anything else away from reading this article?

End of comments.

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