Stories
In 2014, few people had more influence over the investment management industry than Seema Hingorani.
She was chief investment officer of New York City’s pension fund, which meant she was responsible for the pensions of New York City’s army of cops, teachers, nurses and traffic wardens. She oversaw $160 billion in assets.
She spent her time with an unending parade of asset managers, each promising her outstanding risk-adjusted returns, net of fees. It was her job to decide which asset managers deserved the money.
For the asset managers, Hingorani was someone who needed to be impressed. She was the fourth-biggest public pension fund client in the United States. When she spoke, people listened.
Hingorani decided to make use of her megaphone. At an industry conference, she told the assembled bigwigs that their industry had a problem: It was too male-dominated.
She wrote a column for Bloomberg setting out the problem, and what needed to be done. The column blew up. She was inundated with emails, asking her to follow through on it. So she did.
In 2014 she left New York City Pensions and built Girls Who Invest, a non-profit programme whose mission is to introduce more young women to careers in investment management. Eight years later, Girls Who Invest attracts thousands of applications each year, and has placed 1,400 women into more than 100 investment companies.
Hingorani spoke to The Currency while in Dublin to participate in the Irish Association of Investment Managers’ Diversity & Inclusion Symposium, which took place in Dublin on Thursday.
This conversation has been lightly edited for clarity.
Sean Keyes (SK): Tell me about your decision to start Girls Who Invest. At the time you had made it to the top of the investment management business.
Seema Hingorani (SH): I’ve been an investor for about 28 years. Most of that time in the private sector, and four years in the public sector, at the New York City pension fund, ultimately becoming the chief investment officer at the time managing $160 billion.
I learned a lot. It was some of the best years of my career, helping make money for teachers, firefighters and police officers for their retirement. But there were a couple of things that I saw there that I was shocked by, actually.
Being the fourth-largest public pension plan in the United States, I had hundreds of asset managers that came to me because they want to manage New York City’s money. Because we’re a very good client. We’re a big client. We’re a friendly client, we stick around. So they were all coming to me.
But there were also a couple of issues that I saw there. One was anytime I got to anyone’s organisational charts or presentations, I looked down and said, “Oh, my gosh, you guys, where are all the women on your investment committee?”
All the leaders of our industry said to me: “Well, of course, we want to hire women. We just don’t get resumes from women. So we can’t find them.” But otherwise, of course.
So I looked at them. And I said, “Okay, we’ve heard that a lot before. Maybe that’s true. Maybe you’re right, maybe we do have a pipeline problem. And we can fix it.”
All the leaders of our industry said to me: “Well, of course, we want to hire women. We just don’t get resumes from women. So we can’t find them.”
Although I did say to them at the same time: I think we should also have the other part of the conversation though. No judging, but there are still firms out there in our business that have cultures that are not so welcoming to women. Let’s talk about that too because if we do both, focus on the pipeline coming in, and then focus on the cultures that exist, then we’ll make a lot more progress a lot faster.
I had a big megaphone being the fourth-largest public plan in the country, the client, and so these asset managers were willing to listen, so hundreds of them would be in these audiences. And I would say very loudly: “Okay. We have a serious problem in our industry. Because, if we don’t figure this out, we won’t figure out how to get more diverse talent at the table, and more diversity of thought at the table. Then we won’t be as successful over the next 20 years in terms of performance. For all the teachers and firefighters and police officers, for all the moms and dads, for all the grandmothers and grandfathers, all the kids they have saved for to fund their school and education, we will fail. So, given this is a serious problem for the industry, you say you can’t find the women, how about this – we’ll find them.”
They all looked at me and said, “What?” I said, “Yeah. That’s the deal.”
I just wanted to get a conversation started about this, and never intended to start a nonprofit called Girls Who Invest, or go on to do a number of the things that I’ve done in the last 10 years of my career. But I thought it was important for us to all talk about this because in my view, this issue wasn’t a women’s issue. This was an industry issue and we needed to come up with an industry solution. And the only way to do that, in my view, is to have a conversation. We have a lot of great men in our industry but what I kept hearing was, they didn’t want to do the work.
SK: At the outset, you said: “Maybe it’s a pipeline problem, maybe it’s a culture problem. Who knows?” Now you’re in the thick of it. What’s your sense now?
SH: I was willing to believe that there were not a lot of women coming into the door, right? Because otherwise, why wouldn’t everyone want to come into this industry? I love being an investor.
I never even knew what it was to be an investor though, growing up through college. I thought I wanted to be a corporate lawyer. I’m from the Indian community and my family have an older brother who’s a doctor, another who’s an engineer. Finance was not on the list. And I didn’t even know what it was to be in finance.
“Of the roughly $90 trillion that’s managed professionally globally, women manage less than five per cent. That’s not good for anybody.”
And so here I am thinking I want to be a corporate lawyer, even in college. And I thought, well, if I want to be a corporate lawyer, maybe I’ll check out Wall Street. I don’t even know what that is. But some freshmen are doing these kinds of jobs at these banks and so, I don’t know, let me try it out. Well, it was in that trying it out that I fell in love with the market: “Oh, my God, I don’t want to be a lawyer, I want to be an investor, I don’t want to go to law school, I want to go to business school and change my life forever.”
So let’s go fix [the pipeline] first. That we can do. That’s the easy part. The other part, [the culture], that’s the harder problem. You have to have a lot of uncomfortable conversations. And I was going to wait on that point.
So in June 2014, I left that job with New York City. I wrote an op-ed article, which I’d never done before. And Bloomberg published it in September 2014. In that article about getting this conversation started more broadly, I wrote: “Here are the issues, here are the challenges, what do we do? Because let’s just stop talking about it. And let’s just do stuff.” Because that’s who I am. I like to get stuff done. And so I throw out this idea in that article – why don’t we have something called Girls Who Invest and build this pipeline. We will go to high schools in the US and go to colleges in the US and we will find all these super-talented women that I know are everywhere. And we’ll measure them, we’ll train them, we’ll guide them, we’ll prepare them, we’ll send them off into our industry, we’ll never let them feel left alone.
That was a big one. Because to me, it was not enough to train them. “Goodbye and good luck” – and they all leave. [We wanted to] stay with them throughout their careers, so that they’ll become more senior, they’ll help change cultures and they’ll manage money. I mean, out of the roughly $90 trillion that’s managed professionally globally, women manage less than five per cent. That’s not good for anybody. It’s not good for all the community societies, people trying to save for retirement and it’s not good for women.
So after I wrote the Op-Ed, I thought I was done. I’m just gonna go back to my old life in the private sector. But Bloomberg told me my Op-Ed was the fourth most-read article on the terminal that day. And I did get hundreds of emails from men and women that are all over the world, many of whom I have never met before. College professors and business school professors said: “Seema you’ve got to do this.” And I thought, “Whoa, you want me to start Girls Who Invest?” That’s so not what I was planning to do with my career and my life.
We had The Wolf of Wall Street, a TV show called Billions. So those women said, “Why would any of us want to do that?”
But I’m clearly passionate about this. So let me try to figure it out. I just thought about what anyone else would do. When I did my due diligence, I met a lot of people that emailed me, for coffee, breakfast lunches, and dinners, all through a lot of 2014 and 2015. And there are also a number of organisations in the US that have been around for 40 plus years, that helped get more minorities into our business. Much more broadly into sales, trading, research, investment banking, but not so much asset management. I’ve been on their LP advisory councils, with the city of New York pension fund. But I realised even after talking to them that no one was just focused on asset management. And I knew that was a serious issue.
So, having never done anything like this before in my life, with a 10-page business plan and a board, I started this thing called Girls Who Invest in 2015 and I made everything up.
SK: What happened next? So you start to build a pipeline, that’s your first step. And then you introduced these women to the industry. And the culture still hadn’t changed. What happened next?
SH: The issue on the pipeline was twofold. One was the firms not opening their doors to women. So I had to learn what they do, first of all, in the recruiting process. So I went and talked to them. And I said, “Alright, you tell me — you can’t find these women. How do you recruit? Because I don’t know.” I knew investment businesses and their processes. I didn’t know how they were recruiting talent. So they were telling me: “Oh, we go to four schools in the US to recruit.” And then put them on a two-year investment banking series.
I said, “That’s what you do? And what is your strategy for growing diversity? You only go to four schools?” And so the issue was their not doing the work. They were going to their own community of people, who look the same, go to the same schools and play the same sports.
SK: And I’m sure if those firms tried to broaden out their recruiting in a half-assed way, it wouldn’t work. Because the candidate from Yale is probably pretty strong. Finding talent outside the elite schools probably takes a full-court press. A lot of effort on the firms’ parts.
SH: That’s right. It’s hard. So I was willing to do the work. I listened to them. And I heard what the issue was. They didn’t want to train. They just wanted somebody else to do it.
So I knew what I needed to do from that standpoint, to get these firms to open their minds up to other people. Then I had to figure out why these women are not going into our industry. Because we don’t see a lot of them. So maybe there’s something wrong, I don’t know. So I’m trying to find out.
I went to a couple of college campuses in the US and I spoke to a couple of hundred students. So many were like: “We had no idea what it was to be an investor.” But they especially didn’t know it was interesting, stimulating, rewarding, and impactful – impactful was one of those words. “We don’t just want to make a lot of money. We want to make a positive impact on the world.” I’m like, “Yeah, so do I. Why don’t you realise you can do that as an investment manager?”. So I gave a couple of simple examples. They’re like, “Oh, my God, where do I sign up?” So I knew back then there was a group of women that didn’t know about our industry.
Particularly post-2008, after the financial crisis, We had The Wolf of Wall Street, a TV show called Billions, things like that. So those women said, “Why would any of us want to do that?”
I said to them, “Okay, true. But let me tell you about all the amazing women in our industry that are doing all these incredible things. And by the way, they’re my friends, you should meet them. So you can see for yourself.”
At the end of the day, I wanted these women to have this as an option, whether or not they decided to choose it was up to them.
With those things in mind, that’s how I came up with the college summer programme. It’s four weeks to train for a six-week paid internship to be an asset manager. It was always about jobs, and if you’re comfortable settling into those jobs. So I did all the hard work. And I pay for all programmes. So I raised over $25 million in eight years to build Girls Who Invest. We make sure all the programmes are free.
“Not to reach out for help, to me, is just a mistake, because there are groups out there trying to focus on this full-time.”
We have an online model, where we train these women online. It’s very scalable. And the best part of all of this is the diversity of this cohort of women: 70 per cent are women of colour. A lot of East Asian and South Asian women. 25 per cent of them are black and Latino. More than 150 different colleges and universities are represented. 30 per cent of those schools are public universities. So it’s not just about the Ivy League. And 70 different majors of study. So we are taking English majors, philosophy, psychology majors and business majors. I was a psychology-philosophy major in college. I never took a business class ever until I got to business school, and I loved being an investor.
So that programme is working. It’s proven, we have 100-plus firms around the world that hire women. And we have a waitlist. We got over 2,200 applications for slots in my programme for this summer. So on both sides, we’re now one of the hottest tickets on college campuses in the United States, if you’re a young woman, 18-19 years old.
So that’s all great now, but I have said this over and over again, I believe it deep down in my heart and soul, I will be a total failure as a founder of Girls Who Invest if all I ever did was find the super talented women to train them up, only for them to leave the industry.
Already in eight years, we have over 200 women full-time on investment teams. I started with 30 women. There are hundreds more behind them coming, which is great. So that’s all good. Now the question is, how do we keep them in? Because I know our industry is not good at that.
Part of why I joined Morgan Stanley investment management was to help on the other side. To help our industry keep them in. Because we have got to do both.
SK: You have invested so much time and money into creating this organisation whose goal it is to break the cycle and recruit more broadly, and attract more women into your industry. But what should an individual company, maybe in a different industry, that doesn’t have something like Girls Who Invest to draw on? How does an individual company with fewer resources fix the pipeline problem?
SH: I would say there are a number of organisations out there who are working on these kinds of things. So to not partner with them in some way or learn from them in some way is a mistake. Whether or not you could give a financial contribution to Girls Who Invest to be able to participate in the programme, because you’re a small firm, that’s fine, but at least come talk to me about ways you can improve your recruiting practices. Not to reach out for help, to me, is just a mistake, because there are groups out there trying to focus on this full-time.
SK: I remember a finding that investment managers from low socio-economic backgrounds outperformed the industry average. So investment in recruitment can pay off.
SH: Absolutely. We’ve had women come through a programme from difficult backgrounds. One example had a father who was a cocaine addict. Not involved at all. The mother, unfortunately, was also a cocaine addict. She and her mother were going from women’s shelter to women’s shelter in the US. She just could not deal with that anymore. She was about to go to high school and just couldn’t, couldn’t deal with it anymore. And in her application, she wrote about her mother with such respect. Having gone through what she has gone through in her life – the maturity of that.
She writes: “I got four jobs at Joe’s Bar and Grill, Dunkin Donuts, and this, this and this. And I was able to save enough money to buy a used car. And I lived in my car, so I could get out of the women’s shelter.” And one of my classmates from high school saw and heard about what was going on. She told her parents: “Can we please have her come stay with us while she goes through schooling because she wants to go to college?”
She gets herself into one of the best colleges in the country is a business major. And is getting good grades and good scores.
And so that woman crushed it. She just impressed the heck out of everybody in our industry. She’s now in our business full-time and doing so well. There are so many stories like that. And again, when I think about what it is to be a great investor, I think about these characteristics, right? Intellectually curious, work hard, thoughtful, kind, but you’ve got great persistence, and you’re gonna grind it out. Because the markets are tough.
None of this has been about, “It’s the right thing to do – the movement, the social good.” No. This is about making better returns for our clients. That’s what all this is about.
SK: How do you think about the motherhood penalty?
SH: Being a caregiver tends to fall more on women than it does on men. We know that’s a fact. It’s really unfortunate for the business and for these women, of course, but for the business it is all about making business better. None of the conversations that I’ve had about Girls Who Invest, none of this has been about, “It’s the right thing to do. The movement, social good.” No. This is about making business better, better investors, better returns for our clients. That’s what all this is about.
If you’re going to leave out half the population, to me, that makes no sense, right? Why would you ever want to do that? And again, as an investor, I will say this all the time, we as investors would never narrow our investment opportunities. To be the best investor, are you looking to diversify portfolios? Then why would you ever narrow your talent opportunities after this? Does this make any sense?
It’s about making business better. So why would you make it extra hard on women, particularly, who have to be caregivers?
SK: Does that require major surgery to the way businesses operate?
SH: No, it doesn’t. You could do it, in my view, in two ways. You can make it super hard on them, meaning, “Well, you weren’t in the office as much. So you missed out on that deal. And so I gave it to him. And he did really well. By the time you came back, I gave him all your clients.”
Well, that’s not good for the business either. Because think about that. Now, you demoralise one of your high performers. And you’ve rewarded somebody over here. And do you really know if all those clients are as happy?
SK: Are there firms that have done a good job of managing caregiving and motherhood, which you would consider the gold standard?
SH: Either you do that, which I don’t think is a good way to go. Or you do this — and this is what is happening more thankfully, with some prodding and pushing in the uncomfortable conversations — where the guy runs the team, and he’s got a woman who is pregnant, and she’s gonna go on maternity leave. She’s a high performer and there are other guys who are high performers. So he says to her: “I have a wife, and I have kids. And I know it’s hard. And you’re gonna have to spend time out of the office. I know. But, we are busy growing fast. We got lots of great clients, you’ve got a lot of great clients, you’ve got a great book of business. I don’t want our clients to be without your focus. But I know, I believe that when you go home, and you’re on maternity leave, you’re working. I know you’re working. Because I know you.”
Most women, when they go on maternity leave, they work their asses off at home. Right? They’re not just hanging out, taking care of the baby. They’re taking care of the child during the day, maybe if they can’t hire nannies and pay for that. But then at night, they’re online, and they’re on their laptops, and they’re working.
This guy believes her, trusts her and says, “I’m not taking your clients away, because I know you’re still going to work with these clients. So tell me what I need to do to make your life easier to be able to still service those clients, whatever that is, because I know that you’re going to do it. Should I tell the client ‘Look, catch her during these times of day, but she will work 150 per cent during those hours.’ So we’ll sit down with our client, and we’ll work this out.”
SK: But you’re not suggesting women’s workload be reduced during this time. You’re just asking for more flexibility, is that right?
SH: Flexibility. That’s all it is. In our industry or other industries.
SK: Investing is a client-oriented industry. Working culture isn’t just at the firms’ discretion, it’s set in part by clients’ expectations. What parts do clients play in changing work culture?
SH: In our business, the majority of clients are large institutional investors like public pension plans, sovereign wealth funds, university endowments, foundations. Their investment time horizons are 30 years. “So you’re gonna tell me a woman who runs my portfolio goes on maternity leave for three months is going to somehow mess up my performance over the next 30 years?
“I am not firing you. I am not going to give you grief, I’m going to help you in any way I can. Because you have helped me so much in my returns over these last 10 years. So now, I’m going to actually go tell your boss that as I am the client, I will go figure this out with her.”
