Women in Fund Management Continue to Define a New Path of Success in the Financial Services

This week we are profiling amazing women in investment management ahead of our annual career panel event on the 5th November for women in the industry who want to make it to the top.

By Michelle Hendelman and Nicki Gilmour

There is some good news to be had in the fund management sector as performance data from the Rothstein Kass authored report in 2012 would suggest that women are emerging as proven leaders.

The analysis showed that hedge funds managed by women had outperformed the HFRX Global Hedge Fund Index through the 3rd Quarter of 2012. These funds posted a net return through September 2012 of 8.95 percent, equivalently compared to the net return of 2.96 percent posted by the HFRX Global Hedge Fund Index.

However, putting this into context as Christin L. Munsch from the Clayman Institute for Gender Research points out this study usefully documents the performance and experience of 366 senior women in the alternative investment industry but was overall limited to a sample size of 67 women owned funds.

Carrie McCabe, CEO and Founder of Lasair Capital, an institutional alternative asset management firm based in New York City, interviewed by Munsch, estimates that women comprise less than 2 percent of alternative investors.

McCabe noted that the study compared the performance of a lot of men and only a few women. Instead of taking the report at face value, McCabe encouraged everyone in the industry to understand the resilience of the talented women who have thrived in a male dominated business of alternative investing.

She is right, as despite higher performance, female hedge fund managers with a proven track record have trouble attracting as much investor money as male fund managers.

Inside some firms, there is considerable work to be done to reduce macho behaviors it seems with the Financial Times reporting 54 percent of women in asset management have experienced inappropriate behavior from their male colleagues in the office. Many survey respondents stated this behavior occurred on a regular basis, either weekly or monthly.

Furthermore, the large majority –70 percent –of respondents who indicated experiencing inappropriate behavior were women in junior level roles.

Our CEO Nicki Gilmour states,

“Developing pipeline is a complex matter but a starting point is to address systemically the conscious and unconscious bias that exists within firms. We have to make room for talented women who given the opportunity can perform to high standards. The markets can be uncomfortable and people of either gender need a strong stomach but how the work gets done and more specifically gets to do the work, should be examined more carefully by the folks supplying the money”

Back in 2009, The National Council for Research on Women released a report to directly address the lack of women in leadership roles in the investment management industry and ask the important question: “Might greater diversity at those tables correlate with better overall performance, as research has shown in so many industries across the board?”

We disagree with that type of questioning, as “diversity” is only useful if it is related to promoting talented women if the real work is being done of ensuring that untalented people aren’t promoted as they automatically assumed to be more competent based on their (male) gender.

The National Council for Research points out, “With crisis comes opportunity: in this case an opportunity to address the exclusionary biases that are present in the business of money, especially fund management, and to encourage the financial services industry to include more diverse thinking at top levels of management and decision making.”

While this is happening, we will give you strategies to continue to break barriers and forge new pathways to the top and have a good time doing it!

The Glass Hammer is featuring profiles of leading women in asset management all week. We hope you will find their stories to be sources of inspiration and motivation as you navigate your own career in the financial services.

If you specifically work in institutional fund management and would like one of our last remaining seats at our event on 5th November (very limited) contact jilliane@theglasshammer.com