* Black staff in industry say little progress in 20 years
* Hedge funds say do not disclose Black diversity data -
survey
* Investors more concerned about diversity - consultants
(Adds quote, pix)
By Maiya Keidan
LONDON, Aug 24 (Reuters) - When the death of George Floyd
forced companies to reflect on why there were so few Black
people in their senior ranks, top banks and private equity firms
pledged to do better.
But one corner of the finance world - the hedge fund
industry - made fewer public statements.
Hedge funds are mostly small firms employing people who
first made their names in banking. They say their relatively
small size and the talent pool they usually hire from makes
rapid progress increasing ethnic diversity challenging.
"Those who land in hedge funds are those who have been
successful within the banking system in general, so the onus is
really on banks creating the talent that will become hedge fund
managers," said Alain Nkontchou, co-founder of Enko Capital who
worked on JPMorgan's proprietary trading desk and at
BlueCrest.
Black staff in the industry said there had been little
progress in hiring and promoting Black people in 20 years.
A 2018 report by New Financial found the asset management
industry in London had just 12 Black fund managers.
"I hoped we'd be further on today than we are," said Marcus
Gibbs, head of operations for Europe at an American hedge fund
platform, who began working in the industry in 2001 and said he
is regularly the only Black person in the room at industry
events.
In the United States, 2019 regulatory data showed 8.9% of
hedge fund firms were owned by ethnic minorities, including
Hispanic, Black, Asian and Native Americans.
"I'd like to see more Black faces in different areas across
the hedge fund and asset management community,” said Ansumana
Bai-Marrow, chief compliance officer at Cairn Capital.
"I don't see any Black money managers, people making
investment decisions, or Black salespeople."
INVESTOR CONCERNS
Hedge fund industry consultants said that since Floyd's
killing some hedge fund investors - particularly among U.S.
pension funds - are asking about diversity.
"In the past, maybe 5% of our clients would engage us on
this, now it's more like a quarter," said Chris Redmond, head of
manager research at consultancy Willis Towers Watson, which
advises investors on hedge funds.
"Investors are asking who is on our list of hedge funds who
have had good racial and gender diversity."
Albourne Partners, another adviser to hedge fund investors,
also said more clients wanted to know about diversity.
Albourne launched a survey on Aug. 17 asking hedge funds for
data on employee and ownership composition, including ethnicity,
gender and sexuality, which the consultancy can use to provide
information for investors.
"We have seen increased concern and awareness from our
clients on this issue over the last few months," Albourne CEO
John Claisse said.
INDUSTRY EXPERIENCES
Reuters asked 30 London-based hedge funds for data on the
number of Black staff they employ.
Some funds said they did not disclose diversity data while
11 funds declined to comment, including Lansdowne Partners,
Winton Group and Brevan Howard.
TT International Asset Management said that of 89 TT
employees, four were Black and one of the four was involved in
managing money. The firm also said it plans to start unconscious
bias training.
A spokeswoman for Man Group, Europe's largest hedge
fund, said the company does not disclose diversity data but runs
a Black employees network and supports #talkaboutblack, a
campaign to improve diversity in the City of London.
Black people working at hedge funds told Reuters they have
faced an array of negative experiences in the industry.
"I'm going to a lunch, I'm wearing a suit like everyone else
and someone comes to me and asks me where the cloakroom is,"
said one employee at a fund who did not allow him to speak
publicly.
Another senior Black person at a hedge fund who did not wish
to be named remembered being repeatedly asked by a colleague to
fix his computer problems.
"The guys of my generation are broadly tired. We've seen all
of this stuff ... when you're in a conference with your peers
and some guy comes up to you and says how do I get to x and y,".
Daryl Wright, executive board member and head of product &
investment management at Lumyna Investments, a platform for
hedge funds and asset managers, said the problem was an
unconscious association between Black people and negativity.
"I think that's really what comes into some of the issues we
see in the hiring processes, promotions and the way people get
treated day to day in the industry."
Senior hedge fund industry figures said while change has to
be led from the top, it needs to start at the bottom.
"It's quite difficult to address that underrepresentation
when there is no middle layer or senior layer to start with,"
said Jonathan Sorrell, president of Capstone Investment
Advisors.
Sorrell helped to launch a programme last week where eight
hedge funds, including CQS, Man Group, Brevan Howard and TT
International, joined more than 80 firms in the asset management
industry in committing to each hire at least one Black intern.
It aims to boost the number of Black portfolio managers in the
long-term.
Hedge fund industry group AIMA said it is engaging with
Black professionals and with hedge fund leaders who want to take
action specifically on Black representation.
For Gibbs, the hope is that change will unfold much faster
than it has done since he started out.
"Now is the time to act," he said.
(Reporting by Maiya Keidan
Editing by Rachel Armstrong and Jane Merriman)
Man (EMG)
