The global investment industry is still oriented towards men, with almost nine out of 10 asset managers admitting that their default investment customer – the person they automatically target with their products – is a man, according to a new survey.
Pathway to Inclusive Investment, commissioned by BNY Mellon Investment Management (BNY Mellon IM), covered 8,000 men and women across 16 national and regional markets, and 100 global asset managers with combined assets under management of nearly $60trn (€53trn).
In-depth discussions with an international expert advisory panel provided perspectives on the research and ideas on making investment more gender-inclusive.
While 86% of asset managers said their target customers were men, nearly three-quarters (73%) believe the investment industry would be able to engage more women to invest if the industry itself had more female fund managers, who could also be important role models.
But half the asset managers in the survey revealed that just 10% or less of their fund managers or investment analysts are women.
The research identified three key barriers to women investing:
- Income hurdle – on average, women worldwide believe they need $50,000 of disposable income per year before investing any money;
- Perception that investing is inherently high-risk – only 9% of women report they have a high or very high level of risk tolerance when investing, while 49% have a moderate level and 42% have low tolerance for risk;
- Engagement crisis – globally, just 28% of women feel confident about investing some of their money. The survey suggested the industry should look at how to better engage and inspire more women to invest, increasing investment confidence and participation.
According to the study, women are looking for more than just a financial return on their investments: they also want to see a positive impact on society and the environment.
Over half of women (55%) would invest, or invest more, if the impact of their investment aligned with their personal values, while 53% would invest, or invest more, if the fund they invested in had a clear purpose for good.
This is even more pronounced among younger women. Of the respondents, seven in 10 (71%) women under 30 who already invest prefer to invest in companies that support their personal values, compared with 53% of women over 50 who invest.
The report found that if women invested at the same rate as men, it could result in an additional $3.22trn of capital invested globally, with over $1.87trn flowing towards more responsible investments.
Anne-Marie McConnon, global chief client experience officer, BNY Mellon IM, said: “As women, we all have different hurdles to overcome to meet our individual financial goals. Some of these are influenced by demographics and personal circumstances, but some are a result of how the investment industry has traditionally engaged with women.”
She continued: “We believe it is in everyone’s interest for more women to invest, for the future and also wider society. Young women are interested in investing too, but they need to be inspired to do so.”
At a country level, within the seven European countries and regions surveyed, UK women were the most assured about investing, albeit with only 27% saying they were confident. They were followed by 25% of women in Germany and the Nordics (Sweden, Denmark, Finland and Norway) and 23% of Spanish women.
In terms of stock market investing, women in the Nordics appeared the least risk-averse, with less than one-third – 32% – saying that investing in the stock market is too risky for them. In general. they already invest at the same rate as men, according to the data.
The most risk-averse country was Switzerland, with 54% of female respondents avoiding the stock market, compared with an average 45% of women globally who considered stock markets too risky.
The survey found that in Europe, the biggest potential monetary gains from levelling up female investing was in France, where if women invested at the same rate as men, there would be an extra US$478bn assets under management from private individuals. This compares with an extra $312bn in Switzerland, and $120bn in Italy.
BNY Mellon IM plans to review its approach to women’s investing, working with intermediaries and the wider industry to improve engagement. It also aims to effect grassroots change through early engagement about money via its partnership with Inspiring Girls International, a global charity dedicated to raising the aspirations of young girls worldwide.