A woman from a New York housing project who becomes co-CEO of the largest hedge fund firm in the world. A young man who learns investing from scratch in order to provide for his family. A woman who leaves the former Eastern Bloc and pays her way through Harvard so she can learn how capitalism works. A man who doesn’t believe those who tell him finance isn’t for people like him, and goes on to gain a doctorate in econometrics. These are just some of the stories of the hedge fund industry.
Our industry has always attracted pioneers; hedge fund firms are staffed with people who refuse to accept the status quo.
This pioneering spirit is now being turned inwards, as hedge fund firms examine the composition of their own workforces. Despite leading the investment management industry in many fields, hedge fund firms still face challenges when it comes to attracting and retaining diverse talent.
These challenges are not, of course, entirely of the industry’s own making. Social norms in many countries deter women from pursuing quantitative subjects, for instance, and thus limit the pool of talent available to hedge fund firms. Further, the small size of most hedge fund firms limits their ability to search out talent, meaning that those who are not already familiar with the industry may have trouble finding a way in.
The industry, however, is dedicated to improving this situation. Last year the Alternative Investment Management Association (AIMA) convened a global Diversity and Inclusion Steering Group, which has adopted as its mission the creation of “an environment across our industry that celebrates difference, is open to all as a career choice, and can attract a more diverse and inclusive pool of candidates.” To that end, the Group has committed itself to providing the industry with “practical resources, advice, role models and case studies to enable them to develop a culture which embraces difference, and to hire and retain a more diverse and inclusive workforce.”
This paper, produced with support from EY, is the first such resource.
Within the pages of this paper you will find an examination of the challenges faced by the hedge fund industry when it comes to diversity and inclusion. You will also find an explanation of why diversity and inclusion are so important to our industry, and why people choose to join hedge fund firms in the first place. Throughout the paper you will find case studies of individuals and firms with unique diversity and inclusion stories to tell.
The core of this paper, however, is practical. It contains 45 different actions hedge fund firms can take to improve their diversity and inclusion, from how they find new recruits to how they develop their existing talent. Most of the actions described in this paper can be taken by firms of any size, and with any level of resources.
We look forward to supporting the hedge fund industry in its drive to become even more diverse, inclusive, and pioneering.
Jack Inglis
Chief Executive Officer, AIMA
Robyn Grew
Chair, AIMA Diversity and Inclusion Steering Group; Member of AIMA’s Council; Group COO and General Counsel, Man Group
Diya Wilson
Tax Partner, Wealth and Asset Management, EY