After the Crisis: Women Taking the Reins in the Financial Sector

By Tina Vasquez (Los Angeles)iStock_000002096821XSmall

According to Catalyst’s Census of Women Corporate Officers and Top Earners, women are still struggling to attain positions of power and in some cases, the number of women in top-ranking, top-earning positions has declined. For example, women currently only hold 6.2 percent of top-earning positions at the largest companies in the United States, though in 2007 that number was 6.7 percent. Catalyst also found that the number of companies with no women corporate officers has increased from 74 to 75 percent in 2008.

These numbers may seem discouraging, but things may change as a result of the ever-expanding global financial crisis. In an unforeseen twist of fate, a revolution of sorts has occurred in an industry that has long been considered a men’s club: the financial sector. It’s no surprise that the financial organizations that led to the economy’s downward spiral were male dominated. One only needs to think back to February; nearly every CEO or executive that appeared before Congress to discuss the bank bailouts was male. This has led many to wonder if more women in boardrooms would have led to less risk-taking behavior or if the financial crisis would have happened at all- or at least as severely as it has played out.

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Assessing and Managing Operational and Investment Risk: glasshammer2.wpengine.com Seminar for Senior Women on the Buy-Side

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Women-working-on-a-computerTheglasshammer.com hosted the first in the series of invitation-only networking seminars for senior women on the Buy-Side at the Harvard Club in New York City on September 29th. Our intent: to create a peer-to-peer environment for CEOs, Principals and Managing Directors of traditional and alternative funds to enable them to interact with Chief Operating Officers, Chief Technology Officers, Heads of Risk Management, and Heads of Operations and discuss the how the industry has changed over the past two years. The result: 100 female leaders in investment management gathered to network and to hear Cynthia Steer, Chief Strategist of Rogerscasey, Marianne Brown, CEO of Omgeo, Liz Philipp, head of the NY office for PIMCO and Annie Morris, Head of Linedata’s North American Business weigh in on the predicted trends for the industry.

The panel represented a 360-degree view of industry issues from front office to back office and how the “New Normal” means that operational risk is now a primary concern for business leaders who want to continue to compete in 2010 and beyond. Inspired by thought provoking questions posed by moderator Holly Miller of Stone House Consulting, the panelists first addressed the issue of operational due diligence, emphasizing the importance of having a corporate culture which supports a consistent due diligence effort.

“There has been a revolution over the last two years,” said Steer, “[People are recognizing that] you need to read your prospectuses; you need to ‘do’ back office.”

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Faith-Based Fund Management: You’ve Got to Have Faith

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by Liz O’Donnell (Boston)iStock_000005377638XSmall

While so many people have lost faith in Wall Street and the stock market during the past year, many others have renewed theirs. They are the faith-based investors—people investing based on criteria set by religious and social beliefs. Faith-based funds are considered a subset of socially responsible funds, or SRIs. According to Morningstar, faith-based offerings have been launched at a fairly rapid rate since 2000 and currently represent more than half the total of all SRI funds. This is significant when you consider that green funds, also part of the SRI category, are experiencing tremendous growth. In fact, the total of assets under management in faith-based funds has grown from about less than $500 million 11 years ago to more than $31 billion today, per Morningstar.

While many faith-based funds have similar investing criteria as socially responsible funds, like generally avoiding investments tied to alcohol, weapons and tobacco, some add a layer of religious filtering to their investment strategy as well. Take Financial Planning Services, a Washington, D.C. company that employs socially responsible investing, speaking to the Christian community about their financial lives and the difference between “man’s economy and God’s economy.”

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Voice of Experience: Cynthia Meyn, SVP and Senior Operations Manager,PIMCO

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by Pamela Weinsaft (New York City)

Cynthia Meyn, the Senior Operations Manager at PIMCO’s New York Office, spent her childhood on the move, living in three states and a European country, all before the tender age of twelve. And while some might have viewed this as a negative experience, Meyn actually sees it as one that had a wholly positive impact on her. “I think it helped me be at ease meeting new people,” she explained, “and helped me be comfortable trying new things,” a skill which has allowed her to fearlessly take on new challenges in her life and career.

When it came time for college, Meyn moved again, this time from Ohio back to Massachusetts to study math, computer science and philosophy at Smith College. While her senior level research fieldwork was in cognitive science and artificial intelligence, she decided not to pursue it as a career once she realized that artificial intelligence “was just too academic.” Instead, she chose to pursue finance and business, an area she became interested in via a sophomore year internship with Smith College’s Summer Women in Business Mini MBA program, an executive education seminar for women. Meyn said, “My role was to set up, monitor, and staff the computer center. I also got to take the classes with the executive women because I had to help them do the LOTUS spreadsheets. That summer was formative because I met executive women from places like General Motors and AT&T, and they encouraged me to pursue a career in business. They also told me about some internship and training programs that I would be able to get into if I tried. So, because of them, I sought out an internship at Morgan Stanley.”

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Transition Services Helping Asset Management Firms Make Advances

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By Elizabeth Harrin (London)Wall St

It’s been a long time coming, but asset management firms are finally winning back market share in the transition services arena. As banks and brokers drop out of the marketplace, asset management firms are moving back in.

The Move Away from Transition Managers

Transition services is a business area which helps institutional investors transition from one fund manager to another, switch global pension deals, rebalance their portfolios or shift into a new asset class. It always involves a lot of funds, and it’s always complicated. A year on since Lehman Brothers Holdings – a major player in transition services – collapsed, other global banks have also cut out or scaled back their transition divisions, including Citi­group, Royal Bank of Scotland Group and UBS.

It’s not always the banks that are pushing investors away as they reduce their involvement in this area. There are signs that investors are also losing confidence in the bigger names, and turning to specialist or smaller firms – firms that can provide the certainty that their transition services business is a key market distinguisher. The shift in market share has also been helped by the fact that technology and trading venues that were once only available to broker/dealers are now much more widely accessible and firms choosing to put transition services at the heart of their business have the technology skills and budgets to put them on a level playing field.

That said, transition managers themselves are expensive people to have around: they have a highly skilled role, often with a broad background in finance and excellent risk management ability. They also have to be great at managing the relationships with clients and keep a lot of balls in the air at the same time. No investor wants to start a massive portfolio shift and build a relationship with someone in a firm where transitions are an ancillary part of the business and could get cut in the next round of cost-saving measures. Read more

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Diversity Hiring: An Asset for Asset Management?

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istock_000000314707xsmall1by Liz O’Donnell (Boston)

The number one hiring request at fund management firms right now is for diverse candidates, says Karen Fenaroli, a recruiter who specializes in senior level jobs at asset management firms. It sounds encouraging, but is it really? Are the requests for diverse candidates a response to the growing body of literature and research that shows a strong correlation between women at the top and healthy bottom lines? Has Wall Street decided more women and people of color makes for better business? Or are human resource professionals merely mandating that their hiring managers simply follow the Equal Employment Opportunity Guidelines. As Fenaroli puts it, “Are they looking for an appropriate perspective of women in management or just checking off a scorecard?” The answer lies somewhere in the middle.

Clara Sierra is the Executive Vice President of mutual fund company Sentinel Investments, and one of the highest ranking people at the firm. She has an impressive resume having worked at AIG and Alliance Capital before joining Sentinel.  She is also female, Hispanic and a mother.

“On paper I look like everyone else,” she says, “but in real life, I don’t look like anything in the room.” So when she got a call from a recruiter who told her she was the hottest ticket in town and not to worry what the job entailed, just know the position was “top echelon, corner office and they want a woman,” Sierra thought it was “bombastic.”

James Walsh, author of “Mastering Diversity: Managing for Success Under Anti-Discrimination Laws“, says hiring managers are looking first, for great people and second, not to get sued. “The key question is do you want a diverse payroll or do you want diverse people working for you? Is diversity something you look for in the individuals you hire?”
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Overcoming Madoff in Fund Management

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by Elizabeth Harrin (London)

UPI Photo/Monika Graff

UPI Photo/Monika Graff

 “We have definitely seen a deterioration in potential investors because of Mr. Madoff’s activities,” says Tonya Powell, Principal at ELP Capital, Inc, investment company which specializes in real estate-secured assets. “The biggest issue is trust, and the almost automatic assumption created by the media that all fund managers may have participated in the same kind of activities.”

Judi Snyder, Partner at JP Snyder, Inc, a boutique financial planning firm, agrees. “Previously, people blindly trusted advisors and didn’t do their own research. This blind trust led to much of the current economic and investor climate.”

Both women’s firms are using multi-pronged approaches to win back consumer confidence. “There’s a fundamental shift – clients are demanding more education,” says Snyder. “I believe, however, Wall Street doesn’t necessarily want people to be educated.” This is a problem that Snyder’s firm is tackling head-on. “We give our clients homework,” she says. “We want them to do research, become educated and ask questions. We want them to take as long as they need to be comfortable with the investment options that we recommend.”
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Life in a Boutique Firm: Pros and Cons for Women in Fund Management

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by Elizabeth Harrin (London)

There’s more to fund management than the big players like Santander and Jupiter.  Fixed income boutique firms might be smaller, but they are more agile and offer different career opportunities.

“In a boutique firm, people may find themselves wearing many hats,” says Carolyn Dolan, founding principal at New York-based Samson Capital Advisors.  Samson is a fast growing money management firm designed to meet the special needs of affluent families, foundations, corporations and endowments.  The firm currently manages over $5 billion.  “This can be good as well as bad.  It is good in that a person is exposed to various parts of the business.  The negative is that one may have to worry about things that are taken for granted at a larger firm.  For example, during the past two weeks I have worked closely with an attorney on the lease for our new space,” she adds.

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The Future of Hedge Funds

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by Liz O’Donnell (Boston)

New data from Hedge Fund Research, Inc., (HFRI) shows assets invested in the industry increased by $100 billion in the second quarter of 2009, ending at $1.43 trillion. This is the first quarterly increase in assets since second quarter of 2008. HFRI attributes the growth to gains shown during the quarter. The HFRI Fund Weighted Composite Index returned 9.13 percent. This is the best quarterly gain since the last quarter of 1999, although still below the highest peak, reached in 1997. And while investors are still redeeming capital, the pace of the redemptions has slowed from recent years.

But looking past the most current returns, what does the future hold for the hedge fund industry given the tremendous impact of the global financial crisis and amid discussions of government regulations? And what about the outlook for women? Will the recent inflow mean more opportunities or will women still be virtually missing from the industry this time next year?

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Voice of Experience: Pam Flaherty, President, Citi Foundation

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pamflaherty

by Pamela Weinsaft (New York City)

 

At the age of 21, Pam Flaherty, President of Citi Foundation, was well on her way to achieving her childhood dream of becoming an ambassador. While waiting to get called up into a Foreign Service Officer class, she was accepted into the M.A. program in International Relations at the Johns Hopkins School of Advanced International Studies. It was there that she learned more about the realities of life in the Foreign Service and decided, for a variety of reasons, that “it was not the way [she] wanted to go.”

 

Fluent in Arabic and French and still enamored with all things international, she obtained a position as an assistant to a very senior international monetary advisor at Citi in New York. She explained, “Citi [was a good fit because it] is a global company and was very receptive to people with odd kinds of backgrounds.  I started out by doing economic research, which I knew a fair amount about [because economics was a heavy part of the requirements at John Hopkins].  But, from the moment I got here, I realized I was more intrigued by the business environment and solving business problems than by the research I was doing.”

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