On the go: Asset managers who wish to continue to work with some of the biggest pension schemes in the UK will have to disclose how they are targeting diversity or risk losing their business.
A group of pension schemes and consultants, with assets worth more than £125bn, have launched a diversity charter, with the goal to tackle a lack of diversity across the fund management industry.
Called the Asset Owner Diversity Working Group, it includes representatives from Brunel Pension Partnership, Nest, RPMI Railpen, West Midlands Pension Fund, Lothian Pension Fund, and London CIV, which have committed to take account of diversity and inclusion records from fund managers when choosing new partners.
Diversity questions will form a part of the overall assessment scores for each bidder, meaning fund managers wanting to work with these clients will have to “disclose information and demonstrate real devotion on how they are tackling diversity and inclusion within their workforce”, a statement read.
Signatories also commit to including diversity as part of ongoing manager monitoring and a questionnaire will be provided to managers annually for completion, which has been developed to allow schemes to “hold firms to account for ongoing progress”, it added.
The asset owner charter toolkit also includes supporting documents with critical topics on manager monitoring and selection, including suggested questions asset owners can use in their scored fund manager assessments.
The new charter has been welcomed by Guy Opperman, minister for pensions and financial inclusion, who argued asset managers need “to be more representative of the savers they represent”.
He said: “It is good to see pension schemes taking a lead in developing this charter and committing to work with the wider investment industry to improve diversity. I encourage all pension schemes to sign up.”
Diandra Soobiah, head of responsible investment at Nest, said: “As asset owners, we want to work with fund managers to encourage diversity balance at all levels of their company and help build a fairer and more equitable investment industry that better represents our members.
“Having a diverse range of skills, backgrounds and experience will lead to better investment decisions and financial outcomes for our members in the long term.”
