Black Women in Asset Management (BWAM) has called on investment firms to stop "systemic racism" by making changes to their investment processes.
In an open letter to the asset management community, published this morning (October 26), BWAM urged investment firms to promote "racial equity" through their investment portfolios and recruitment processes.
The letter makes five recommendations, one of which is to build an anti-racist investment portfolio.
This would work by assessing a company's commitment to racial diversity and by disinvesting from businesses that continue to have racial inequalities or target vulnerable individuals, for example prison labour.
The letter also calls on firms to expand the pipeline of young black women starting investment careers.
BWAM said firms could provide guidance to young black women who are in secondary school, sixth form and university education in order to develop strong candidates for future employment opportunities.
Firms should also look to promote black women to senior leadership roles by coming up with suitable progression plans, which consist of coaching and mentoring.
The letter states: “These strategies will give black women an equitable opportunity to advance to senior leadership and add diverse voices to the people who shape investment strategy and make investment decisions.”
BWAM also wants to see firms call for policy change and implement internal policies that tackle racial injustice.
Firms should make it clear to the government that they will not stand for systemic failures in education, healthcare, criminal justice, and law enforcement that “lead to negative outcomes and limited opportunities for black people”, BWAM stated.
Jacqueline Taiwo, co-founder of BWAM and associate general counsel at TowerBrook Capital Partners, said: “Dismantling systemic racism creates a more sustainable and equitable society, however, investment firms have been slow to see racism as a serious investment risk.”
“Our letter sets out actions I believe will lead to progress and give black women a greater voice in shaping investment decisions.”
Last week (October 21), warning bells were sounded over a "chronic underrepresentation" of minorities in City firms, after research found none of the financial companies in the FTSE100 had a black executive director.
Recruitment firm Ruebik and non-profit Operation Black Vote warned there was an "impenetrable glass ceiling" for black people in the UK’s largest companies after it found none of these firms had a black executive director and of their collective 259 board members, only five were black.
The research warned the companies in the industry were "ignoring a pool of talent right on their doorstep".
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