New Knight Foundation Study Illuminates Gaps in Endowments' Commitment to Diversity
For Immediate Release: June 30, 2022
Contact: Carolyn Clendenin, cclendenin@rabengroup.com, 347-869-7382
New Knight Foundation Report Dives into Diversity of Asset Managers at Colleges & Universities
While the report shows the potential for progress, it’s also clear that far too many universities & colleges are reluctant to be transparent about their use of diverse managers.
Washington, D.C. - Today, the Knight Foundation released a comprehensive report on 16 major colleges’ and universities’ use of asset management firms owned by women and racial or ethnic minorities. Notably, 50 schools were asked to participate in the study, and the vast majority declined.
Robert Raben, executive director and founder of the Diverse Asset Managers Initiative -- an effort to bolster racial and gender representation in the asset managers industry -- issued the following statement in response:
“We are greatly appreciative to the Knight Foundation, the Global Economics Group, and NYU for taking on this important research. It’s crucial to push for transparency among institutions that have historically been quiet about their use of diverse asset managers.
“While this study shows signs of progress, it also illuminates how far we have to go. For one, 34 institutions, representing $273 billion in assets, declined to participate. It’s absurd that in 2022 – when so many institutions have finally committed to transparency – such a large number of schools still refuse to report their diversity figures.
“Additionally, while participating schools did provide general numbers about their use of diverse firms, this doesn’t paint the full picture. Often, the most underutilized asset managers are Black, Latino/a, and Native American. By simply reporting on ‘diverse’ firms without a specific breakdown of racial and ethnic groups, schools can mask major disparities in their use of managers.
“Case in point: While Duke, commendably, is one of the few institutions to break down its diversity numbers, we can see its lack of Black and Latino/a managers quite clearly. The Knight Foundation report reveals that 32.1 percent of Duke’s assets are managed by U.S. diverse-owned firms. But Duke’s website shows that only 2.4 percent of its assets are managed by Black-led firms, while 3 percent are managed by Hispanic- or Latino-led firms. Unfortunately, many schools – like Princeton and Stanford – still won’t provide such comprehensive data.
“To ensure higher education institutions are fully utilizing diverse managers, they need to share their data. Everyone knows that the major institutions are not working with a critical mass of Black or Latino/a managers. Why in 2022 are they still being coy about this? Tell the truth, then we can figure out how to improve.”
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The Diverse Asset Managers Initiative is an effort to increase the absolute number of, and assets under management by, diverse-owned asset management firms for institutional investors, with specific focus on public, corporate, faith and labor union pension funds as well as foundation and university endowments.