Key Takeaways

  • A diverse and inclusive workforce challenges conventional thinking and creates a more dynamic and rewarding working environment. The ultimate aim of good Diversity & Inclusion (D&I) mirrors other governance initiatives: to lead to better experiences for clients.
  • D&I is where ESG was a few years ago; that is, entering the consciousness of many investment firms. ESG is arguably an important investment issue of the day, and D&I is heading in the same direction.
  • Changing the culture of the investment firm starts with leaders and team heads, who must be vocal about D&I issues. Once a dynamic D&I business plan has been determined centrally, it is critical it can be implemented locally, and supported by HR policies and new metrics.
The way the investment industry operates is changing. Take a typical investment manager filling out a request for proposal (RFP) from an asset owner: A decade ago, the questions centered squarely on track record and process. Today, questions relating to corporate culture, diversity, and inclusion figure high on most lists. Everything from the number of women on the board, to LGBT+ representation in the workforce, to diversity programs is likely to be under scrutiny. Due diligence may also seek to elicit how deeply corporate culture is embedded in the fabric of the firm, the diversity of idea generation, and how well a firm embraces a new generation of workers with different mindsets and expectations.

Meanwhile, some investment managers are posing similar questions before they make significant allocations, scrutinizing public filings and asking for additional information and explanation.

It is easy to regard these questions as tick-box exercises, and as a problem to be solved. But is diversity and inclusion (D&I) just a matter of form filling? Is it a problem or is it the solution? “D&I is about creating a happier, more cohesive, better represented workforce,” says Tracey Flaherty, Global Head of Diversity & Inclusion at Natixis Investment Managers. And the improvement in governance and employee wellbeing should, all else being equal, lead to better experiences for investors.

So much for the theory. What happens when we take D&I off the written page and put it into practice in the real world?

The D&I Journey So Far
The investment industry is on a D&I journey. It is probably fair to say D&I is roughly where ESG was a few years ago. That is, entering the consciousness of investment firms, but not yet embedded in the DNA of all of them.

And look at where ESG is now. It has become a critical cog in the asset management industry, with many investment strategies now incorporating ESG factors alongside financial factors. Investor demand for ESG investments has even spawned a sizable subset of the industry, with whole investment firms devoted to creating sustainable portfolios. ESG is arguably a very prominent issue today.

D&I is heading in the same direction and consultants, the gatekeepers to the institutional industry, are keenly aware of the direction of travel. “Change can be tough, but it will be worthwhile in the end – D&I is the smart thing to do,” says Mercer. Meanwhile, Willis Towers Watson (WTW) says D&I needs to be “woven into the fabric of culture, benefits, pay and workplace practices.”1 Ultimately the general perception when it comes to D&I today is that there is often a gap between effort, understanding, and outcome.


Case Study: WTW2
“Effective cultures in investment organizations”
D&I has two motivations – to build a fairer and better culture, and to build a stronger and better business model. These have overlaps and can be complementary. Cognitive diversity is critical to the business case and particularly important to be achieved where problems to be solved are complex.



The D&I momentum is rational. A diverse and inclusive workforce enables employees to learn from one another and challenge their own beliefs and conventional thinking. This creates a more dynamic and rewarding working environment that helps attract and retain the best people.

D&I can drive growth at investment firms through:

  • Leadership – more diverse thinking and better decision making
  • Talent – retention of best people drives innovation and future growth
  • Clients – better fit with expanding customer base who have more diverse values
What Is D&I All About?
Before we look at how the investment industry is incorporating D&I into its practices, let’s take a moment to consider what the important elements of D&I are.

First, diversity. This is commonly viewed as a gender and race issue. In fact, it is much broader and extends to respecting the variation in backgrounds, attitudes, values, beliefs, and lifestyle preferences of all employees.

These variations may exist because of gender, race, ethnicity, nationality and first language. They may also stem from age, mental and physical abilities, sexual orientation, education, religion and socioeconomic situation.


Case Study: House of Commons Treasury Committee3
“Women in Finance”
The gender distribution in financial firms follows a “pyramid” model where the number of women diminishes in line with seniority. Women are better represented in support functions than in profit-generating functions. Ensuring young women are aware of the career paths within the financial services sector could encourage them to move away from support functions. In the longer term, this could improve the gender diversity of the sector and reduce the gender pay gap.



Next, what is inclusion? “We see it as practices that provide an equitable and fair distribution of resources, such as jobs, income and opportunities,” says Flaherty. These practices allow all employees to be appreciated and fully integrated into the formal and informal networks of an organization.

“In essence, inclusion is about creating a safe and inclusive organization, which is capable of identifying and eliminating poor behaviors and embracing positive behaviors,” Flaherty adds.

Inclusion may also mean harnessing the strengths of a new generation of workers. The upcoming generation has only known the digital age, and has grown up in a world where values and economics have changed considerably from the preceding generation. The new generation is no less talented than its predecessors, and firms must establish structures which facilitate its successful integration.

New Mindsets, New Skillsets, New Tools
Implementing D&I requires actual change. The structures that worked in the past are probably not up to the task of culture change.

Changing the culture of the investment firm starts with leaders and team heads, who must be vocal and visible about D&I issues. Implementation must be done locally, not simply announced at regional or global level. Implementation must be supported by HR policies, transparent data, and new metrics, which are created from employee surveys and employee experience interviews and by engaging the workforce and stakeholders regularly. Firms should ask themselves: If the current executive team were to leave tomorrow, would the corporate culture remain intact? If not, the implementation process probably needs revisiting.


Case Study: PwC4
“Making Diversity a Reality”
  1. Create a leadership team that sets a positive influence.
  2. The recruitment process should identify strong candidates irrespective of factors such as age, gender, or ethnicity.
  3. Ensure employees have equal opportunities to participate in development programs.
  4. Recognize where talent lies on an ongoing basis.
  5. Opportunities to progress should be communicated to all employees regularly.
  6. Flexible working policies are crucial to employee wellbeing.


The output should be assessed using effective data analytics to identify targeted actions which are likely to have the greatest return and largest impact.

Last, and not least, all these efforts must be communicated to staff. If staff cannot locate D&I policies and join activities, then the effort may be wasted.

How to Do D&I Well in the Real World
The ultimate aim of good D&I mirrors other governance initiatives: to improve experiences for clients. Resources to achieve D&I include:

  • Training. To improve hiring and promotion processes and cognitive diversity.
  • Measurement and accountability. Using key performance indicators and external certification.
  • Better employee benefits and wellbeing. Deliver a sustainable human capital model through mentoring, leave of absence programs, flexible working, and enhanced healthcare programs which include mental health provision.
  • External commitment. Join relevant associations and groups, and promote initiatives through social media, PR, whitepapers and events.
Every investment organization will prioritize where it devotes its resources depending on its D&I aims and workforce profile. The main areas of action for Natixis Investment Managers are gender equality, inclusion and retention of staff with disabilities or illness, intergenerational co-operation and diversity of backgrounds.


Case Study: The Investment Association5
“Bringing Our Whole Selves to Work”
This report from the Investment Association (“IA”) noted that because many LGBT+ employees disguise their identity at work, employers should demonstrate the company is welcoming of LGBT+ employees during induction. The IA also stated that all staff should demonstrate support of LGBT+ employees by asking about their non-work life in the same way as for any other employee and that companies should foster an inclusive environment because it’s the right thing to do, not because you fear causing offense or generating complaints. it is also important to support all employees around the globe, even in jurisdictions where awareness of LGBT+ issues is low.



Natixis Investment Managers also puts emphasis on developing a family-friendly corporate culture. Examples of this from locations across its global network include flexible work schedules and telecommuting opportunities, and ample maternity and paternity leave allowances. It also offers adoption assistance and subsidized backup family care assistance. It further offers tuition reimbursement and a student loan repayment program. Training is also critical and the firm offers bias busting and cognitive diversity training programs.

Natixis Investment Managers D&I Programs
In 2015, Natixis Investment Managers established a Diversity & Inclusion Advisory Council, and employees are encouraged to initiate new groups of interest. Examples established by affiliates include Multicultural and Diversity Engagement Group (MADE), Adults Building Leadership Experience (ABLE), Women’s Leadership Initiative (WLI) and Latino and Friends (LaF).

Other programs include the Women in Natixis Network (WINN), a global network that supports career success and the personal growth of women at Natixis. More than 800 members are engaged in WINN groups across Natixis Investment Managers’ operations in the US, Paris and London.

Today, around 40% of the Natixis Investment Managers workforce (across the holding company, distribution operations and affiliates) is female. Among Natixis Investment Managers investment professionals, 30% are women. Of the trainee and work-study positions available, 50% are taken up by women.

Natixis also extends its D&I values to the wider community, developing partnerships with organizations that share its ideas. Partnerships include the G7 Investor Leadership Network, Strong Women Strong Girls, The Partnership and Invest in Girls. We are also a very active supporter and partner of a large number of charities and not-for-profit organizations, including those associated with homelessness, young students, and schools.


Case Study: Mercer6
“When Women Thrive, Businesses Thrive”
Financial services organizations are failing to build future pipelines of female talent. The stated ambition of financial services firms to hire and promote women to executive ranks is not supported by systemic practices. Firms must install passionate leaders, and put in place the right practices and programs.



Of course, no good deed is entirely selfless. Natixis Investment Managers benefits from these partnerships by finding recruits with diverse backgrounds through participation in these activities.

Natixis Believes in D&I Practices
Natixis Investment Managers encourages its affiliates to consider D&I workplace practices. Natixis affiliates are independently managed and have their own policies and programs in place; however, all entities share a common philosophy on the importance of an inclusive workplace.

As an “active” asset management firm, we espouse long-term investing, patient capital, and strong ethics in our investment operation.
1 Employees Widen View of Inclusion and Diversity to Include Workplace Culture and Benefit Programs. April 2019 by Willis Towers Watson (available at https://www.willistowerswatson.com/en-US/News/2019/04/employers-widen-view-of-inclusion-and-diversity-to-include-workplace-culture-and-benefit-programs).

2 Effective Cultures in Investment Organizations. July 2019 by Thinking Ahead Institute, Willis Towers Watson (available at https://www.thinkingaheadinstitute.org/en/Library/Public/Research-and-Ideas/2019/09/Culture_leadership_study).

3 Women in Finance, Fifteenth Report of Session 2017-9. June 2018 by House of Commons Treasury Committee (available at https://publications.parliament.uk/pa/cm201719/cmselect/cmtreasy/477/477.pdf).

4 Making Diversity a Reality. 2015 by PwC (available at https://www.pwc.com/gx/en/industries/financial-services/assets/pwc-diversity-and-inclusion-making-diversity-a-reality.pdf).

5 Bringing Our Whole Selves to Work: The LGBT+ Experience in Asset Management. July 2018 by The Investment Association (available at https://www.theia.org/sites/default/files/2019-05/20180701-bringingourwholeselvestowork.pdf).

6 When Women Thrive, Businesses Thrive: Turning Disruption into Opportunity for Women and Business. January 2017 by Mercer (available at https://www.mercer.com/content/dam/mercer/attachments/global/glb-2017-davos-wwt-wef-summary.pdf).

This material has been provided for information purposes only to investment service providers or other Professional Clients or Qualified Investors and, when required by local regulation, only at their written request. This material must not be used with Retail Investors. In the E.U. (outside of the UK and France): Provided by Natixis Investment Managers S.A. or one of its branch offices listed below. Natixis Investment Managers S.A. is a Luxembourg management company that is authorized by the Commission de Surveillance du Secteur Financier and is incorporated under Luxembourg laws and registered under n. B 115843. Registered office of Natixis Investment Managers S.A.: 2, rue Jean Monnet, L-2180 Luxembourg, Grand Duchy of Luxembourg. Italy: Natixis Investment Managers S.A., Succursale Italiana (Bank of Italy Register of Italian Asset Management Companies no 23458.3). Registered office: Via San Clemente 1, 20122 Milan, Italy. Germany: Natixis Investment Managers S.A., Zweigniederlassung Deutschland (Registration number: HRB 88541). Registered office: Im Trutz Frankfurt 55, Westend Carrée, 7. Floor, Frankfurt am Main 60322, Germany. Netherlands: Natixis Investment Managers, Nederlands (Registration number 50774670). Registered office: Stadsplateau 7, 3521AZ Utrecht, the Netherlands. Sweden: Natixis Investment Managers, Nordics Filial (Registration number 516405-9601 - Swedish Companies Registration Office). Registered office: Kungsgatan 48 5tr, Stockholm 111 35, Sweden. Spain: Natixis Investment Managers, Sucursal en España. Registered office: Serrano n°90, 6th Floor, 28006 Madrid, Spain. Belgium: Natixis Investment Managers S.A., Belgian Branch, Louizalaan 120 Avenue Louise, 1000 Brussel/Bruxelles, Belgium. In France: Provided by Natixis Investment Managers International – a portfolio management company authorized by the Autorité des Marchés Financiers (French Financial Markets Authority - AMF) under no. GP 90-009, and a public limited company registered in the Paris Trade and Companies Register under no. 329 450 738. Registered office: 43 avenue Pierre Mendès France, 75013 Paris. In Switzerland: Provided by Natixis Investment Managers, Switzerland Sàrl, Rue du Vieux Collège 10, 1204 Geneva, Switzerland or its representative office in Zurich, Schweizergasse 6, 8001 Zürich. In the British Isles: Provided by Natixis Investment Managers UK Limited which is authorized and regulated by the UK Financial Conduct Authority (register no. 190258) - registered office: Natixis Investment Managers UK Limited, One Carter Lane, London, EC4V 5ER. When permitted, the distribution of this material is intended to be made to persons as described as follows: in the United Kingdom: this material is intended to be communicated to and/or directed at investment professionals and professional investors only; in Ireland: this material is intended to be communicated to and/or directed at professional investors only; in Guernsey: this material is intended to be communicated to and/or directed at only financial services providers which hold a license from the Guernsey Financial Services Commission; in Jersey: this material is intended to be communicated to and/or directed at professional investors only; in the Isle of Man: this material is intended to be communicated to and/or directed at only financial services providers which hold a license from the Isle of Man Financial Services Authority or insurers authorized under section 8 of the Insurance Act 2008. In the DIFC: Provided in and from the DIFC financial district by Natixis Investment Managers Middle East (DIFC Branch) which is regulated by the DFSA. Related financial products or services are only available to persons who have sufficient financial experience and understanding to participate in financial markets within the DIFC, and qualify as Professional Clients or Market Counterparties as defined by the DFSA. No other Person should act upon this material. Registered office: Office 504-D, 5th Floor, South Tower, Emirates Financial Towers, PO Box 118257, DIFC, Dubai, United Arab Emirates. In Taiwan: Provided by Natixis Investment Managers Securities Investment Consulting (Taipei) Co., Ltd., a Securities Investment Consulting Enterprise regulated by the Financial Supervisory Commission of the R.O.C. Registered address: 34F., No. 68, Sec. 5, Zhongxiao East Road, Xinyi Dist., Taipei City 11065, Taiwan (R.O.C.), license number 2018 FSC SICE No. 024, Tel. +886 2 8789 2788. In Singapore: Provided by Natixis Investment Managers Singapore (name registration no. 53102724D) to distributors and institutional investors only. Natixis Investment Managers Singapore is a division of Ostrum Asset Management Asia Limited (company registration no. 199801044D). In Hong Kong: Provided by Natixis Investment Managers Hong Kong Limited to institutional/ corporate professional investors only. In Australia: Provided by Natixis Investment Managers Australia Pty Limited (ABN 60 088 786 289) (AFSL No. 246830) and is intended for the general information of financial advisers and wholesale clients only. In New Zealand: This document is intended for the general information of New Zealand wholesale investors only. This is not a regulated offer for the purposes of the Financial Markets Conduct Act 2013 (FMCA) and is only available to New Zealand investors who have certified that they meet the requirements in the FMCA for wholesale investors. Natixis Investment Managers Australia Pty Limited is not a registered financial service provider in New Zealand. In Latin America: Provided by Natixis Investment Managers S.A. In Chile: Esta oferta privada se inicia el día de la fecha de la presente comunicación. La presente oferta se acoge a la Norma de Carácter General N° 336 de la Superintendencia de Valores y Seguros de Chile. La presente oferta versa sobre valores no inscritos en el Registro de Valores o en el Registro de Valores Extranjeros que lleva la Superintendencia de Valores y Seguros, por lo que los valores sobre los cuales ésta versa, no están sujetos a su fiscalización. Que por tratarse de valores no inscritos, no existe la obligación por parte del emisor de entregar en Chile información pública respecto de estos valores. Estos valores no podrán ser objeto de oferta pública mientras no sean inscritos en el Registro de Valores correspondiente. In Colombia: Provided by Natixis Investment Managers S.A. Oficina de Representación (Colombia) to professional clients for informational purposes only as permitted under Decree 2555 of 2010. Any products, services or investments referred to herein are rendered exclusively outside of Colombia. This material does not constitute a public offering in Colombia and is addressed to less than 100 specifically identified investors. In Mexico: Provided by Natixis IM Mexico, S. de R.L. de C.V., which is not a regulated financial entity, securities intermediary, or an investment manager in terms of the Mexican Securities Market Law (Ley del Mercado de Valores) and is not registered with the Comisión Nacional Bancaria y de Valores (CNBV) or any other Mexican authority. Any products, services or investments referred to herein that require authorization or license are rendered exclusively outside of Mexico. While shares of certain ETFs may be listed in the Sistema Internacional de Cotizaciones (SIC), such listing does not represent a public offering of securities in Mexico, and therefore the accuracy of this information has not been confirmed by the CNBV. Natixis Investment Managers is an entity organized under the laws of France and is not authorized by or registered with the CNBV or any other Mexican authority. Any reference contained herein to “Investment Managers” is made to Natixis Investment Managers and/or any of its investment management subsidiaries, which are also not authorized by or registered with the CNBV or any other Mexican authority. In Uruguay: Provided by Natixis Investment Managers Uruguay S.A., a duly registered investment advisor, authorized and supervised by the Central Bank of Uruguay. Office: San Lucar 1491, Montevideo, Uruguay, CP 11500. The sale or offer of any units of a fund qualifies as a private placement pursuant to section 2 of Uruguayan law 18,627. The above referenced entities are business development units of Natixis Investment Managers, the holding company of a diverse line-up of specialized investment management and distribution entities worldwide. The investment management subsidiaries of Natixis Investment Managers conduct any regulated activities only in and from the jurisdictions in which they are licensed or authorized. Their services and the products they manage are not available to all investors in all jurisdictions. It is the responsibility of each investment service provider to ensure that the offering or sale of fund shares or third party investment services to its clients complies with the relevant national law.

In the United States: Provided by Natixis Distribution, L.P., 888 Boylston St., Boston, MA 02199 for US financial advisors who do business with investors who are not US Persons (as that term is used in Regulation S under the Securities Act of 1933) or persons otherwise present in the US It may not be redistributed to US Persons or persons present in the US Natixis Investment Managers includes all of the investment management and distribution entities affiliated with Natixis Distribution, L.P. and Natixis Investment Managers S.A.

The provision of this material and/or reference to specific securities, sectors, or markets within this material does not constitute investment advice, or a recommendation or an offer to buy or to sell any security, or an offer of any regulated financial activity. Investors should consider the investment objectives, risks and expenses of any investment carefully before investing. The analyses, opinions, and certain of the investment themes and processes referenced herein represent the views of the as of the date indicated. There can be no assurance that developments will transpire as may be forecasted in this material. Although Natixis Investment Managers believes the information provided in this material to be reliable, including that from third party sources, it does not guarantee the accuracy, adequacy, or completeness of such information. This material may not be distributed, published, or reproduced, in whole or in part.

Natixis Investment Managers
RCS Paris 453 952 681
Share Capital: €178 251 690
43 avenue Pierre Mendès France
75013 Paris
www.im.natixis.com

2963855.2.1