“We just spent the time staring at your arse in that tight cream dress, bending over the boardroom table” was the comment from a client that completely disarmed me as a newly qualified corporate lawyer. I was at a predominantly male completion dinner with some of my colleagues and a male management team, having just worked that “arse” off completing a massive management buy-out in record time, culminating in 72 hours working with no sleep.
Fortunately, during my career, explicitly sexist comments like this have been rare. But being in a room filled with men and finding it tough to break into the conversation or feeling like I am suffering from a language barrier (when everyone is actually speaking my native language) has been a common theme. I find it difficult to put my finger on what it is that I find challenging about these situations, particularly when I work well with my male colleagues and clients, and count many men as my close friends. On a social level, I hold my own with men and women alike. Kim Elsesser, business psychologist, calls this “the sex partition”. Forming new business and social relationships is easier with people who are similar to us and, generally, the same sex. “The communication is easier and more predictable, and it results in greater trust”. And, taking this further, breaking into groups of the opposite sex, particularly in a competitive, marketing environment, is even harder.
The Financial Times reported in November last year that, according to research examining over 26,000 funds across 56 countries, only one in five has a female portfolio manager, a figure which has not improved since the financial crisis and in 2015 women held only 10.3 percent of C-suite positions in the hedge fund industry. Research also shows that, despite the evidence that women-owned or women-managed hedge funds outperform the industry, women-run funds continue to find capital raising more difficult than their male peers. This has led to many asserting that women must work harder and perform better to achieve the same results.
The reasons behind this are, of course, complex but Elesser puts the blame largely on the “gender partition” claiming that “men like to invest with men”. Dawn Fitzpatrick, now CIO of Soros Fund Management but formerly Head of Investments at UBS Asset Management, agrees “The academic data shows that people tend to want to work with people who look and act like them. ” It is interesting that, despite encountering similar challenges when it comes to motherhood and competition, women are not being held back from securing senior legal, compliance, and marketing roles to anything like the same extent, and this may be, in part, down to the large role that networking plays in raising capital and that it predominantly takes place in male-dominated environments.
Today is International Women’s Day, and we need to be thinking about what we can do to change the tide. Not only for the sake of gender equality, but also for the good of the industry. Doug Haynes of Point72 asserted that lack of performance “is related to sameness” and, as Dawn Fitzpartick commented “We need to do a better job of educating people on the unconscious bias they have and the demonstrable benefits to bottom-line results of well-constructed team diversity”.
We need to work to increase the pool of candidates for investing roles and make sure that more of them are considered for positions. 100 Women in Hedge Funds (recently rebranded as 100 Women in Finance), leads the way in promoting women in hedge funds and the financial services industry; increasing the pool by investing in the next generation, providing mentoring and creating a space for women to network and build relationships.
As women in the industry, whether in investing roles or not, we need to make ourselves visible. There is safety in numbers and if more of us attend networking events and conferences and appear on speaking panels, the “sex partition” becomes smaller. Like many women, family commitments complicate my ability to attend after-hours events and take business trips abroad but this year I am traveling to the US to make sure Harneys’ female contingent is visible in person, starting with the Cap-Intro East conference presented by North Street Global. I look forward to meeting some of our readers (male and female) there.
Most importantly, we need institutional investors to invest in women-led funds. While mandatory allocations have proved extremely unpopular or even discriminatory, in this period of lack-luster performance, the numbers should speak for themselves and seeking out diversity will become vital to creating alpha.
For other perspectives from woman litigators at Harneys, please see this post on our sister publication, The Offshore Litigation Blog.