At a certain point in our education we get invited to complete a career assessment – a series of questions the responses of which, coupled with a little bit of pixie dust, magically forecast our perfectly matched job. I have a vague recollection of this happening around the age of 12, but that was quite a while ago so my memory could be playing tricks. The output of the exercise tended to produce generic results, along the lines of lawyer, accountant, vet, teacher. I don’t recall anyone I know being informed that they demonstrated the aptitude of an aspiring portfolio manager. I’ve been giving this a bit of thought lately, after listening at a recent conference to some quite damning feedback from new graduates about their perception of the investment management industry. Broadly the feedback could be summarised by the three words; ‘male, stale and pale.’
The feedback is not a shocking revelation. As someone to whom the words aptly apply, I have often looked around the room at industry conferences and seen row after row of people who share my gender and demographic. That said, at the very conference where the feedback was given, I sensed a different dynamic in the room – it felt younger and more diverse, both from the perspectives of gender and ethnicity. So, perhaps some progress is being made but going back to the educational analogy, our report card summary is that we ‘could do better’.
The challenge is how can we improve? I think a huge part of the problem is that the investment management industry is not particularly well known. Certainly, the career path of portfolio manager, analyst, marketing or sales manager are things that one seems to fall into, rather than working towards via a specific educational path. As a young investment consultant, I was always amazed at the number of successful portfolio managers who studied classics at university. Not that I’m saying it is not a perfectly good qualification for portfolio management, but I feel confident most of those individuals did not embark upon their studies with a view that they would end up managing a portfolio of equities as their job.
So just as there have been campaigns for primary schools to provide the foundations to practical financial concepts, such as the compounding effect, I think the investment management industry needs to think about how it can better promote itself as a career choice – probably to children in secondary school education. The focus needs to be on the detail rather than ‘careers in finance’. Too often I’ve interviewed new graduates for jobs and asked what attracts them to investment management and their answers describe a life suited to investment banking! We need to be specific about the role of portfolio management, the value it can bring to society and the different roles of the people within the ecosystem of investment management.
If we can offer clarity on what the industry does, demonstrate the breadth and depth of skills required and highlight the benefits of careers within it, then we surely are in a better position to attract – and ultimately retain – a more diverse workforce. Couple this with a more targeted approach to schools in the poorer sections of society and to specific gender and ethnicity, maybe in time we’ll no longer have the image of an industry that is male, stale and pale.