While CalPERS and CalSTRS have held a joint diversity forum every year since 2015, the virtual event on June 22 may have found its moment.

This year’s event will feature a Diversity Dialogue with SEC Commissioner Allison Herren Lee; a panel on managing diversity and human capital with New York State Comptroller Thomas P. DiNapoli, who is also the sole director of the $ 254.8 billion New York State Pooled Retirement Fund, Albany, and the CEO of State Street Corp. Ronald O’Hanley; and a diversity dialogue with New York Stock Exchange President Stacey Cunningham.

The forum is aimed at the investment industry, business leaders and other professionals.

Marcie Frost, CEO of $ 469.8 billion California Public Employees Retirement System, Sacramento, said it had seen a modest improvement in diversity in the financial management industry in recent years, but there was still a long way to go.

“Frankly, what’s missing in the space is good disclosure,” Ms. Frost said. “That’s why we’re pushing as hard as we are with the SEC and corporate engagement.”

CalPERS and other asset owners are working with the SEC in hopes the agency will require companies to include diversity data in their regulatory files. CalPERS, CalSTRS and many other asset owners are also pushing companies to diversify their boards.

“There has been modest improvement, but I can’t say that with today’s data,” she said.

CalPERS follows its own advice. For the first time this year, CalPERS included questions about diversity in its internal staff survey in November. Seventy-five percent of employees voluntarily answered questions on ethnicity, sexual orientation and gender. The majority of every demographic said they felt they were treated fairly, with respect and dignity, and had a sense of belonging to CalPERS, according to survey results released at a June 16 meeting of CalPERS Performance, Compensation and Talent Management Committee.

Asset owners want to do business with investment managers led by diversified management because diversity adds to performance, Ms. Frost said.

Among industry organizations working on the issue is the CFA Institute, which, for example, in 2019 launched the Experimental Partners Program, a series of roundtables that include asset owners and fund managers. The CFA Institute has also published research on the subject, including a recent survey showing that women make up 15% or less of all fund management executives at the CEO, CIO, portfolio managers and research analyst levels. .

Sarah Maynard, London-based Global Head of External Inclusion and Diversity Strategies at the CFA Institute, is expected to attend the CalPERS and CalSTRS Diversity Forum to share best practices for fostering diversity, equity and inclusion in the financial management sector.

Changes are slow in the financial management industry, but “we certainly see them,” said Christopher J. Ailman, CIO of $ 299.8 billion California State Teachers Retirement System, West of Sacramento.

He said the CFA Institute’s work to create best practices for increasing diversity, equity and inclusion in the industry “has raised the bar for everyone.”

Mr. Ailman was part of the CFA Institute’s Diversity and Inclusion Steering Committee which introduced a process for fund managers to extend DEI in their businesses.

He said fund managers are increasingly aware of unconscious biases, which can prevent women and minority executives from being hired and promoted to leadership positions in companies.

Unconscious biases arise when people stereotype groups of people without realizing it.

“People pay more attention to the language they use and unintentional biases” when making hiring and promotion decisions, said Ailman.

CalSTRS officials would like to see diversity and inclusion at the top of the corporate ladder among fund managers, he said.

“We are seeing that managers are paying a lot more attention to this and hiring is improving a lot,” Mr. Ailman said.

The pandemic has forced most people in the industry to work from remote locations and business leaders have learned they can run their businesses that way, he said.

Working from home “will be a huge opportunity for working mothers” and women re-entering the workforce after maternity leave, Ailman said.

It’s more of a challenge for private equity firms because they make long-term investments. Women returning from maternity leave face plans that unfold in their absence and pick them up halfway through, he said.

In a fixed income management company, for example, there is a constant daily rhythm and new mothers returning to work can more easily re-integrate into the work environment, he said.

Companies, including alternative investment managers, need to redouble their efforts to provide a more diverse set of career advancement opportunities for executives.

“Investors come in all shapes and sizes and they need to be more open,” he said.

Ms. Frost of CalPERS agrees. She said she was “lucky” not to have experienced prejudice or not to see it unfold.

“But I want to make sure our systems are free from bias,” Ms. Frost said.

Even so, she added, “too often I’m the only woman in the room.”

“I am fortunate to have a professional network and my male counterparts know this is not an acceptable ratio,” she said.

Yet asset owners are eager to see more diversity, fairness and inclusion among their fund managers.

“If you cast a wide net, fair competition will ensue,” she said.

Registration for the conference is free. The agenda and the registration link are on CalPERS ‘ website.

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