Dear clients and colleagues,
This week we attended the 2019 CalPERS & CalSTRS Diversity Forum in Sacramento, California. CalPERS (The California Public Employees’ Retirement System) and CalSTRS (The California State Teachers’ Retirement System) are the two largest pension funds in the United States. This is the fifth forum of this kind, featuring experts from McKinsey, Goldman Sachs, State Street, The Carlyle Group, Ernst & Young, CFA Institute and Lancaster University, to name a few. Over 400 people participated, mostly investment managers. We found the sessions very educational and would like to share some takeaways with you.
First of all, how do we define Diversity and Inclusion?
A very interesting quote we heard at the Forum was: “Diversity is being asked to the party. Inclusion is being asked to dance.”
Diversity often refers to the variety of similarities and differences among people, and includes a wide range of factors, such as gender, race, ethnicity, religion, disability and work style.
Inclusion is a dynamic state of operating in which diversity is leveraged to create a fair, healthy and high-performing organization or community. An inclusive environment ensures equitable access to resources and opportunities for all.
What did the data tell us?
McKinsey issued a diversity report in 2018 based on a large data set of over 1,000 companies in 12 countries. The findings were:
Why do Diversity and Inclusion matter for investment management firms now?
At Global Alpha, we strongly believe that team diversity is a key contributor to successful investing. It has been a deliberate practice at the firm to build a team of investment professionals with different genders, backgrounds and experiences. When hiring, we look for candidates who can work well within a team environment and who are able to demonstrate flexibility and resilience when faced with difficult portfolio management decisions.
One of our three founders is a female minority. Among the six members of our management team, two are female and three are minorities. Of the ten people that make up the entire Global Alpha team, three are female and five are minorities.
In conclusion, there is no doubt that the business case for diversity is compelling. Building a truly inclusive culture takes a long-term tremendous effort, but it’s well worth it.
Have a great week.
The Global Alpha team
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