UK asset owners join forces for diversity push

August 13, 2021

Some of the UK's largest pension investors have collaborated to establish a formal, repeatable diversity assessment and improvement process.

The Asset Owner Diversity Charter was announced at the end of July as a collaboration between 17 pension funds and investment consultants that are collectively responsible for more than £1 trillion.

It is led by a seven-strong group of representatives from the Lothian Pension Fund, Brunel Pension Partnership, NEST, the Cambridge University Endowment Fund, RPMI Railpen, London CIV, and the West Midlands Pension Fund.

The group has issued a rallying call for more signatories to build a "set of actions that asset owners can commit to improving diversity, in all forms, across the investment industry".

The charter has two components. The first is an Asset Manager Diversity and Inclusion Questionnaire, which "aims to standardise complex diversity metrics" that go beyond gender and improve existing disclosure standards. The results of this questionnaire will inform a "progress report" that will help the organisation develop its diversity and inclusion work.

The second element is the Asset Owner Charter Toolkit, a supporting document to "aid in the implementation of the charter". It will include guidance on key topics such as manager monitoring and selection.

Brunel Pension Partnership's Helen Price, head of stewardship, engagement and voting at the £35 billion pension investor and co-chair of the Asset Owner Diversity Charter, told Portfolio Institutional: "Information on race, age, ethnicity, sexuality and socio-economic backgrounds are not being consistently collected in a way that equips the industry to identify barriers and make meaningful progress.

“We expect fund managers to manage diversity as a material investment issue, but we question how well they are doing this if they are doing little to address it in their own organisations.

“By asking for this information fund managers will have to confront poor performance and begin taking much-needed action on diversity.”