Australia and NZ still rank low in the fund manager gender diversity stakes despite a slight improvement since 2008, a new Morningstar global study has found.
According to the Morningstar ‘Fund manager by gender’ report published last week, just 11 per cent of managed funds in Australia and NZ include a female portfolio manager compared the global average of about 20 per cent.
The study shows the proportion of women fund managers in Australasia has climbed from 9.9 per cent as at January to the latest higher measure taken on December 2015.
Of the 28 jurisdictions published in the report, Spain, Portugal, Hong Kong and Singapore recorded the highest female funds manager representation with scores above 25 per cent – and close to 30 per cent in the case of the latter.
UK-based Aberdeen Asset Management had the best individual firm gender balance with women occupying more than 31 per cent of all equity fund manager roles, the study found.
In general, Morningstar says female fund managers appear to have stronger influence in countries with smaller financial centres with the world’s largest funds management market, the US, near the bottom of the scale with just under 10 per cent of women.
Chris Douglas, Morningstar Australasia director manager research, said while the study doesn’t separate out the two trans-Tasman countries, NZ does at least feature a number of high-profile women fund managers.
“NZ does punch above its weight there,” Douglas said, with local identities such as Mint Asset Management, chief, Rebecca Thomas, and Fisher Funds founder, Carmer Fisher.
Fisher announced her intention to retire next year.
He said the report found funds management globally had a worse gender diversity track-record than other professions.
“It’s interesting to see that funds management has a bigger under-representation of women compared to other professions like law and medicine,” Douglas said.
The Morningstar study – authored by Madison Sargis and Laura Lutton – says that “in all cases where data is available” the funds management industry has a lower proportion of women than lawyers or doctors.
“In France, for example, women are 21% of managers named to registered funds, while women are more than half of that nation’s lawyers and 43% of France’s doctors,” the Morningstar report says. “In the US, the rate of women funds managers is lower than that in France at 10%, and the rate of women lawyers and doctors also is lower at 36% and 33%, respectively.”
As well as the dearth of women relative to other professions, the Morningstar research found significant gender bias in roles and behaviour within the funds management world.
For example, the report shows women are up to more than 40 per cent likely to run a passive fund compared to men.
“… the data tells us that the average woman fund manager is less likely to be involved in active management,” the report says. “This is the first instance where we see women moving away from active security selection.”
Furthermore, Morningstar says the trend away from women managing individual securities was also reflected in the growing number of females in the fund-of-funds space.
As well, the report found women were less likely to run multiple funds or work as solo managers (and, conversely, more highly represented in ‘team-managed’ funds).
“Fortunately for women, team-managed funds are in vogue,” Morningstar says. “When our study began in January 2008, the percentage of team-managed funds was 39.7%, but by December 2015, that percentage rose to 45.1%.”
Women also appear to be less volatile fund managers than their male counterparts with the Morningstar research showing they are less likely to trade than men “in periods of distress or growth”.
“This invest-with-conviction approach that we observe among women may be especially beneficial for active managers, which increasingly face cost scrutiny and largely have underperformed passive funds with a conventional higher-turnover approach,” the study says. “Unfortunately, our research shows women have lower odds of managing active funds.”
Interestingly, the report found the one funds area traditionally featuring high female content – socially responsible investing (SRI) – has shifted recently in favour of men.
The Morningstar research says the supply of women fund managers hasn’t kept up with demand from the burgeoning SRI sector.
“Our study suggests that men entered this market as it expanded, causing the overall likelihood of a woman managing a socially conscious fund to decrease,” the report says.
Morningstar began sexing the industry from a database of 26,340 managers of funds registered in 56 countries, allocating gender according to information supplied or by algorithmic sifting through first names where possible.
The report says there was scope for further research into questions such as barriers to entry for women in the funds industry, asset allocation variation between sexes, comparative career opportunities, and “relative performance by gender”.
“In the coming months, we expect to continue studying women in the financial industry,” Morningstar says.