City employers continue to invest in diversity, equity and inclusion despite having to cut costs in the past year, according to a report from the Investment Association.
The annual Culture, Talent and Inclusion report from the IA looks at companies that make up almost three-quarters of the UK asset management industry, and employ 81% of workers in the sector.
In a snapshot of the year to December 2023, it found that companies are improving data collection on diversity.
More than six in 10 respondents said they were collecting data across at least six strands of diversity, namely age, disability, ethnicity, gender, religion and sexual orientation.
Collection rates are highest for gender, age and ethnicity, cited by more than 80% of firms. The lowest rates of collection are for socio-economic background and neurodiversity, the IA found.
Diversity in the City
The vast majority of firms said they collected demographic diversity data to foster a positive and inclusive culture (92%), while two-thirds said they were tracking against internal diversity targets and 61% said they were looking towards future regulations.
Employees are happier to disclose their diversity status, too. The IA found that non-disclosure rates declined across all attributes year-on-year, with the sharpest declines in gender and sexual orientation. However, the non-disclosure rate for ethnicity is 18%.
The figures showed a relatively young workforce, with just over a third (34%) under the age of 35. Just over four in 10 (41%) investment management employees are female, up two percentage points from 2022.
However, female representation in the older workforce declined, with numbers of 50 to 64-year-old females comparatively lower. The IA said a gap emerged between men and women from the age of 35 onwards, suggesting women may be taking a break from the industry to raise families.
At senior level, 70% of executive leaders hired in 2023 were White/White British compared with 80% in 2022. Overall, the industry is made up of 62% white employees, 10% Asian, 3% Black and 2% from a mixed ethnicity background.
Responsibility for EDI initiatives sat at the top of the organisation for two-thirds of firms (either the CEO or other executive directors), and with the board of directors in 21%. Under a third (29%) leave the implementation of EDI strategy to DEI teams alone.
“People are at the heart of our industry’s success, and we benefit from harnessing the collective strength that comes from nurturing talent across all sectors of society,” said Karis Stander, director of culture, talent and inclusion at the IA.
She said the report highlighted the benefits of “robust data collection and analysis”, which would help the industry pinpoint areas for change.
Marisa Hall, head of WTW’s Thinking Ahead Institute, which supported the report, said it showed “tangible improvements” in its second year.
“EDI is one of those soft factors increasingly influencing organisational success and investment performance. The insights revealed today have the potential to uncover hidden drivers and patterns for tomorrow. This study looks to the future – to the organisations of tomorrow,” she said.
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