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7/20/2023
Expanded report includes private markets firms to address challenges in the alternatives space
Santa Monica, Calif., July 20,2023 –Wilshire today released the2022 results of its annual Diverse-Owned Manager Initiative Report, highlighting the firm’s continued commitment and progress to furthering diversity, equity and inclusion ("DE&I") in manager searches as well as improving diversity in its workplace. The report showed that the proportion of Wilshire clients investing with diverse-owned firms has more than doubled from 20% in 2018 to 48% in 2022, while the percentage of manager searches awarded to diverse-owned firms has increased 62%.
“This report continues to mark our commitment to promoting greater transparency on DE&I efforts that we are pursuing both internally and externally,” said Jason Schwarz, Deputy CEO and President at Wilshire. “We are pleased to share that since launching this report in 2018, we have made strides to bolster visibility for diverse-owned managers as well as increase transparency around our own efforts to create a diverse, equitable and inclusive culture. In turn, our clients have affirmed the initiative via broader ownership of diverse-owned firms.”
“We believe that diversity in all forms leads to better business outcomes, and this initiative and report demonstrates our commitment to offering full disclosure on our own diversity profile and efforts to grow the number of diverse-owned managers that we engage with and that our clients invest with,” said Leah Emkin, Chief Client Officer at Wilshire. “We are committed to raising the visibility of diverse-owned managers and nurturing a diverse and inclusive culture at Wilshire, consistent with our core values.”
Report Highlights
The 2022 report showed:
• Inclusion Rate Shows Notable Growth – In 2022, the inclusion rate of diverse-owned firms in manager searches increased to 62% (up from 56%in 2021), after remaining stable at just under half of all searches from 2018 –2020, demonstrating Wilshire’s continued commitment to increasing the allocated assets to diverse-owned firms.
• Increased Engagement with Diverse-Owned Private Markets Managers – Wilshire’s proprietary manager portal that tracks firm ownership data for alternative asset managers allowed the firm to identify 196 private markets firms as diverse owned-managers. This is a 70% increase from 2021.
• Broadening the Opportunity Set for Wilshire’s Clients – The number of managers and products highly rated by the Wilshire Manager Research team grew annually by 14% and 21%, respectively from 2018-2022. This has the potential to further increase asset allocations to diverse-owned firms, as a greater choice of managers increases the likelihood of new mandates.
• Mandates Accelerate for Diverse-Owned Firms – Win rates have accelerated across all manager searches with the total number of mandates awarded to diverse-owned firms growing to 17% of all searches.
• Assets Held by Diverse-Owned Managers Grows – Nearly half(48%) of Wilshire’s discretionary and non-discretionary client-base has placed assets with diverse-owned managers, a nearly 50% increase since the inception of the 2018 report (20%).
Next Steps
“Over the past five years, Wilshire’s Diverse-Owned Manager Report has effectively impacted the visibility of diverse-owned managers and allowed us to hold ourselves accountable in our engagement,” added Joanna Bewick, CFA, Senior Vice President, Portfolio Manager at Wilshire. “Last year, we broadened the scope of diverse-owned managers that we track to include private markets managers which resulted in significant growth in the number of managers identified and engaged in 2022. Moving forward, we expect to enhance our tracking capabilities on private markets managers, allowing for more year-over-year comparisons of the total number of firms and inclusion across our formal research and due diligence process. We will continue to raise the profile of diverse-owned managers among our clients and consultants, as we believe that diversity increases the likelihood of capitalizing on investment opportunities in an increasingly global and diverse world.”
Next steps for the program include:
• Attracting and retaining diverse talent via focused management of inclusivity
• Measuring future progress in diversity at all levels of the organization against the baseline established by the annual report, while also identifying new metrics to further enhance the report
• Increasing the number of diverse-owned firms and strategies rated by Manager Research with attention to asset classes where representation is challenged, such as private markets
• Incorporating data on the diversity profile of the firm (in addition to ownership) as a dimension of the manager research evaluation
• Continuing to educate Wilshire’s client base on the value proposition of diverse-owned firms, such as capitalizing on investment opportunities
The full report can be found here.
Wilshire is a global provider of market-leading indexes, advanced analytics, and multi-asset investment solutions. A trusted partner toa diverse range of more than 500 leading institutional investors and financial intermediaries, our clients rely on us to improve investment outcomes for a better future. Wilshire advises on over $1.3 trillion in assets and manages $86billion in assets and is headquartered in the United States with offices worldwide.
More information on Wilshire can be found at www.wilshire.com.
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Wilshire has been applying highly tested theories and approaches to our client solutions since 1981.
Our clients rely on us to improve investment outcomes for a better future.