Jasmine Richards, Head of Diverse Manager Research
As Head of Diverse Manager Research at Cambridge Associates, Jasmine leads our efforts to source and invest capital with underrepresented managers. In this CA Conversations, she shares how DEI is built into the foundation of our research process and how diverse managers can drive investment returns.
Is diverse manager research separate from other manager research efforts?
Diligencing and allocating capital to diverse managers is thoroughly integrated into our global research process across all asset classes. We focus on getting the right managers within our investment pipeline and applying an equitable underwriting process. Our investment teams add diverse managers into portfolios because of their potential to outperform. Today, more than 60 percent of our global clients hold investments with diverse managers.
But do clients believe that diversity makes a difference?
Yes. We conduct a biennial impact investing survey and one of the things we ask clients about is their motivation for considering various investment decisions. In the 2020 survey, clients’ belief that diversity leads to outperformance has increased more than seven times since 2018. We believe that that number will continue to increase.
And does that attitude translate to demand for more diverse managers?
There has been an exponential increase in demand among our clients and the industry at large. Research suggests that the prevalence and impact of bias within asset management is real and we believe there is more work to be done to create awareness and demand for investing with diverse managers. We are focused on breaking down implicit and explicit structural barriers that prevent capital flows.
Do you have specific goals around your work with diverse managers?
We have over 20 years of history working with diverse managers and believe the opportunity for investing with diverse managers is great and expanding. In 2020, we publicly committed to double both our assets invested with diverse managers and the number of diverse managers we partner with by the end of 2025 — and we’re on target to meet that goal.
What are some of the alliances you’ve built to expand CA’s network in this space?
This is still a network-driven business so the relationships we’ve built and continue to build to encourage people to consider careers in investing matter. We’re working with groups like The Investment Diversity Exchange, 10,000 Black Interns, National Association of Securities Professionals, and New America Alliance, where we worked together to launch their Pathway Fellowship Program. These organizations are not only critical to finding investment partners, but they are also key to diversifying the asset management industry overall.
Any notable successes to highlight at this point?
Our north star has to be allocation of assets. Between June 2020 and June 2021, we invested with 86 additional diverse managers — our goal for that time period was 40. To continue to expand that universe, we held 119 meetings in fourth quarter 2021 with diverse managers and completed due diligence on 18 managers. Every quarter we make progress.
When do you declare victory?
Never. The search for the next best investment idea is always ongoing — which means that the search for the diversity of thought to find those ideas is also perpetual.
*Cambridge Associates defines diverse managers as firms owned and/or led by women and people of color; and diverse firm ownership/leadership as minimum 33%. The managers held by clients are not necessarily recommendations of Cambridge Associates.