Diverse investment management: Squaring the circle


1 Jun 2023

A case study in addressing investment outcomes with diverse managers.


A case study in addressing investment outcomes with diverse managers.


The aim of achieving greater investment outcomes with diverse managers is a much-discussed issue. In fact, some would say it is more talked about than acted upon.

One investment firm that has been looking at this issue for some time is Cambridge Associates, which revealed it has already met its five-year goal set in 2020 to double its investments with diverse managers from 5% to 10%.

Jasmine Richards, head of diverse manager research at Cambridge Associates, is making sure the company is not resting on its laurels. “The work is never complete,” she says. “But when investment decisions can be grounded in more equitable processes, they can ultimately drive toward the most positive out- comes for everyone.”

Sticking to this principle, Cambridge has now set a 15% diverse manager target for 2025.

There were a number of driving forces that propelled Cambridge Associates to meet its diverse manager goal.

Notably, and most revealing, was the commitment of the firm’s diverse manager research team who worked to integrate diversity measures throughout the due diligence process and show a commitment to sourcing and evaluating a larger funnel of opportunities.

Cambridge revealed that it wasn’t until this intersected with an increase in client demand for, and willingness to invest in, diverse managers that meaningful momentum took shape.

Cambridge reveals that 62% of its clients hold investments with diverse managers, an impressively high number.

Furthermore, a survey of clients across the US, Europe and Asia identified social equity – including gender and race – as a top driver for investing to make an impact.

Evidence that asset owners are influencing the debate in ways that could well reshape the investment universe in terms of diversity.

This is especially important given that the approach to diverse manager investment has, as highlighted, been more discussed than embraced and been somewhat ad hoc as a result.

Melinda Wright, global head of diversity, equity and inclusion at Cambridge Associates, highlights how the idea of diversity should underpin a commitment to diverse investment for it to work.

“We believe that inclusive teams make better decisions, demonstrate greater collaboration, bring forth bolder ideas, and drive better financial and investment outcomes,” Wright says.

To support these beliefs, she says Cambridge Associates has committed itself to take on two roles in the diversity debate: acting as stewards of long-term capital and also as champions of change and opportunity.


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