Less than one in five (14%) partners at hedge funds, private equity firms and other financial services partnerships are women, according to employment law firm Fox & Partners.
This proportion accounts for just 1,361 of the 9,485 partners and is unchanged from previous years, with women making up 14% of all partners in 2018 (1,381 of 9,957) and 13% in 2014.
The Treasury launched the Women in Finance Charter in 2016 to help build a ‘more balanced’ industry. However, Fox & Partners said that its findings suggested that no progress has been made on increasing gender diversity at senior levels and that there is still a long way to go.
Diversity at a senior level in private equity firms and hedge funds seems to lag behind broader industry trends, the research stated, with women now making up 27.5% of directors at FTSE 250 companies.
Gender diversity is slightly better at a slightly more junior level in this sector, with women making up 16% of directors at private equity firms and hedge funds.
Catriona Watt, a partner at Fox & Partners, said that financial services partnerships have slipped under the radar. “While listed companies are in the spotlight private equity firms and hedge funds often deliberately take a low profile – to an extent that their performance in terms of diversity in leadership has not come under much scrutiny," she said.
Watt added that this "may change" as investors apply more pressure on funds to demonstrate ethical business practices. "Diversity is increasingly important to investors and something funds will need to be aware of. Many would-be investors are now interested in environmental, social and corporate governance (ESG) aspects of potential funds they invest in – a male-dominated firm may deter them," she said.
“If GPs [general partners] ask private equity funds to improve diversity then we may see much quicker change. The reality is that with the availability of increased data on business performance and diversity in leadership, hedge funds and private equity firms may soon realise that they are missing out on huge talent by recruiting from a relatively small pool.”