Fund managers still very pale

CORONATION: BEATS ALL PEERS ON TRANSFORMATION SCORES

South Africa’s fund management industry doesn’t seem to be taking transformation seriously; some don’t even seem to be keeping score.

Investment managers in South Africa lag behind the country’s five retail banks when it comes to employment equity, submissions before Parliament show. In its submission to parliament’s hearings on transformation in the financial services sector, the Association for Savings and Investment South Africa (Asisa) showed the industry is far behind targets on three counts: the number of black executive directors, the number of black people in senior management positions and the number of black middle managers.

Much more needs to be done on even the number of black professionals in junior management positions, an area where the country’s banks (mostly) exceed the current target.

These statistics, presented by Asisa chair Thabo Dloti, are based on the draft 2015 Financial Sector Charter Council report. That this is still not published and that these (at least) 18-month-old statistics were presented to parliament is an indictment on the sector.

It is also not yet clear which institutions provided data to the council for this report. In 2013, only eight out of 75 asset-management companies provided data.

On employment equity measures – or the number of black managers in junior, middle and senior ranks – the asset management industry trails all the retail banks but one, Capitec.

But Capitec outperforms the investment management industry on the junior management score. Where asset managers do outperform banks is on the number of black executive directors and top management.

Here, only Nedbank fares better (at 54%), versus the industry average for money managers of 39%.

Obviously size differences matter. Coronation, for example, has 286 permanent staff in South Africa, versus the 13 000 at Capitec and ±30 000-40 000 at the four other banks.

Coronation, the largest asset manager in the country, outperformed most peers on transformation.

Chief executive Anton Pillay says it has “achieved meaningful and sustainable transformation”. Three of its four exco members are black, and “more than half its total staff complement in South Africa are black, of which more than 60% are female”.

As at the end of September 2016, 43% of senior portfolio managers in the team were black, while three out of four leadership roles were filled by black investment professionals (head of Fixed Income, head of SA Equity, head of SA Equity Research).

London-domiciled Old Mutual Investment Group’s representation of black employees in management (as at June 2016) was: 36% senior managers, 66% middle managers and 77% junior managers.

This is also significantly above the industry average as reported by Asisa.

Sygnia notes in its 2016 annual report that 51% of its (175) staff are black and 54% are female. During the 2016 financial year, both these measures exceeded 50% for the first time.