Asset managers including JPMorgan Asset Management (JPMAM), BlackRock and Standard Life have backed an initiative set up by the 30% Club to push for a third of FTSE companies to have women on their boards.
As a McKinsey & Co report revealed financial services were in the "top quartile" for improvements in gender diversity (see below) 27 groups with £10.5trn in AUM have committed to pushing for 30% of women on FTSE 350 boards and 30% of women in senior management at FTSE 100 companies by 2020, according to the Financial Times.
The asset managers will engage with boards chairs and "may choose" to vote against the re-election of the chair of the board of nomination committee where there continues to be no evidence of board diversity.
Aviva Investors, who signed the 30% Club statement at the campaign group's launch in October 2016, said it now raised gender and diversity as a "routine item" in its conversations with companies; since October 2016, the group said it has voted against 82 annual meeting resolutions because of diversity reasons and plans to extend this voting stance to its non-UK holdings in 2018.
Mark Zinkula, chief executive of Legal & General Investment Management, said in 2017 it had voted against 37 UK companies which were taking "insufficient" steps to increase diversity.
"Investors have tremendous influence and we strongly encourage all asset managers and asset owners to do more to drive change at a faster pace at both board and executive level," he told the FT.
The 30% Club launched as a campaign in the UK in 2010 with a goal of achieving a minimum of 30% women on FTSE-100 boards - currently the figure stand at 27.9% up from 12.5%
Financial services 'in the top quartile' for gender diversity improvements
The initiative follows a report by McKinsey & Co that found levels of gender diversity in financial services companies have improved more than in other industries, with 18% of executive teams in the sector made up of women.
In the report, entitled Delivering through Diversity, the consultancy said "financial services firms are over-represented in the top quartile for gender diversity."
Women made up an average of 18% of executive teams in financial services, which includes the asset management industry, compared to 13% at consumer and retail companies.
At the other end of the spectrum, technology, media and telecom companies saw the greatest decline in diversity since 2015, which McKinsey attributed to the high-profile news over gender bias and pay in those sectors recently.
However, levels of gender-diverse representation in financial services firms have increased more than levels of ethnic and cultural diversity since 2015.
In addition, the report found a business is likely to perform better financially if its workforce is more diverse - companies in the top quartile for gender diversity on their executive teams were 21% more likely to have above-average profitability than companies in the fourth quartile.
In addition, firms in the top quartile for ethnic diversity are 33% more likely to see higher-than-average profits than companies in the lowest quartile.
The least diverse companies, in both gender and ethnic terms, are 29% more likely to underperform in terms of profitability, the report added.
The survey analysed publicly-available data from 1,007 companies across 12 countries globally.
There have been several industry initiatives run by figures such as Dame Helena Morrissey and the City Hive's Bev Shah to encourage more women into the asset management industry, while companies are considering diversity policies as a criteria for investment.
The report particularly namechecked Allianz, the insurance firm, as a firm which promoted diversity and also held managers accountable for delivery and success of diversity policies.
"Not only does the company promote acquired diversity - for example, by employing people of different national origins and cultural exposure and by encouraging international rotations - it also shares its progress against all of its diversity goals, holds its managers accountable for delivery and celebrates their successes."
Have your say: Should trustees be held accountable for the security of data and assets in the event of a cyber attack?
In this week's Pensions Buzz, we want to know if you agree that trustees be held accountable for the security of data and assets in the event of a cyber attack.
More than four in five employers oppose the implementation of multiple pensions dashboards and any that do not include state pensions, the Association of Consulting Actuaries (ACA) says.
Half of scheme representatives agree fiduciary duty hinders trustees in addressing climate change, finds XPS
Half of scheme representatives believe the current fiduciary duty of trustees hinders them in their ability to address climate change, according to a poll by XPS Pensions Group.
PMI president Lesley Alexander and the institute's immediate past-president Lesley Carline talk about the challenges of Covid-19 and the opportunities and challenges the industry faces in the future.
The Pensions Administration Standards Association (PASA) has announced global consultant Deloitte as its expert knowledge provider for data.