Podcast: Lessons on diversity and inclusion in asset management

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Andrew Thorne, a partner in PwC’s asset and wealth management sector, and Alan Bowser, co-head of Bridgewater’s America region and chief diversity officer, discuss how Bridgewater, an asset management company, is approaching diversity and inclusion, including lessons learned and future plans.

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Andrew Thorne - Partner in PwC’s Asset and Wealth Management Sector

Julien Courbe

Please explain Bridgewater’s deep commitment to a concept you call idea meritocracy.

Alan Bowser - Co-head of Bridgewater’s America Region and Chief Diversity Officer

Shannon Schuyler

Our idea meritocracy is rooted in our mission and our core values.  Bridgewater is committed to excellence based on constant improvement, including building the best understanding of the economy and global markets.  Our core values stress equity and rewards based on merit.  To win in markets you need the best ideas.  That doesn’t come from title or hierarchy.  It’s built on constantly seeking the best thinking, regardless of who is bringing it to the table.

Thorne: How do diversity and inclusion fit into those values?

Bowser: It ties back to this notion of getting the best ideas.  To do that you need great teams, but you also need diverse teams.  Just as one person does not have as broad a vision as a group, people from the same background will not have as rich a collection of perspectives as a more diverse group.

So, we put a premium on diversity of thought.  It gives us different ways of perceiving problems, reasoning and visualizing solutions.  We find that our success is driven by this focus on creating diverse teams that bring a wide variety of experiences and backgrounds to studying global economies and markets.

The importance of feedback

Thorne: Please describe Bridgewater’s feedback mechanism and how it’s applied to the firm’s D&I focus.

Bowser: We address feedback head on, even if it’s uncomfortable.  That’s an important part of our culture; we’re committed to having honest conversations.  That doesn’t make D&I discussions automatically easy.  Those are tough conversations and they can be really tricky.

However, if you start from the foundation and culture of feedback focused on transparency and trust, you are much further ahead in your ability to take on the difficult, honest and sometimes messy conversations about D&I where both parties can learn from each other.

Thorne: How has data been applied to the D&I focus at the firm?

Bowser: First, as a general matter, data is a feedback loop for our business overall.  We trade markets, and we believe prices move for logical cause and effect reasons.  Our goal is to first understand the logic behind those linkages.  But then we use data – measuring how our logic would have played out if we applied it through history and across global markets – to stress test our logic.  It’s a feedback loop.

For D&I, data can also help us evaluate our thinking.  Let me give you an example.  You might think of something as basic as the recruiting funnel.  We might have a view on how we expect candidates to flow through the funnel based on the process we designed to find and attract diverse talent.  But then we want to look at the data to see if we’re getting the outcomes we anticipate.  If not, we want to use that data to help understand where the cause and effect linkages are breaking down. Is it breaking down on sourcing?  On evaluation?  Is it breaking down in the conversion rate?  The data will help us understand the root cause of the problem and hopefully develop a better solution.

The art of campus recruiting

Thorne: Can you tell us about your recruitment process? 

Bowser: The bulk of our hiring comes from campus recruiting.  That pipeline starts with internships after a student’s junior year.  From that pool of interns we make campus hires.

In the past few years, roughly 40-50% of the offers we’ve made from that internship program have been to women, and about 20-30% have been to minorities.  We feel like that reflects good progress, but we want to keep doing more.

Broadly speaking there are three levers we use to help identify, attract and hire diverse talent through our campus pipeline.  The first is that we've intensified our own internal efforts.  Bridgewater has a core of internal recruiters who focus on target schools around the country, and we’ve dialed up the efforts among that team to focus on people from diverse backgrounds.  The second lever is expanding our target schools.  And the third thing we've done is to add new partnerships.  These partnerships are an extension of our own internal efforts.  We’ve identified organizations that specialize in attracting, coaching and promoting diverse talent.

Thorne: What are some lessons you’ve learned?

Bowser: There are probably lots of lessons, but I think two stand out.  First, it’s better to have deep and sustained partnerships.  Those are the kinds of relationships that will lead to strong talent pipelines that ultimately bring the best talent to your door.  The second lesson is something I think is broadly understood – you have to start early.  So while our internship program is for students who've just finished their junior year, we actually start earlier than that.  We run an immersion program for students who’ve completed their sophomore year to help give rising juniors a closer look at Bridgewater a full year ahead of any decisions are made about internships.  And more recently we're exploring starting even earlier, perhaps as early as freshman year.  We’re exploring a broad reach program that might use a virtual classroom and mentorship experience to achieve two things – help develop talent and help discover future stars. 

The future of D&I

Thorne: Let’s talk about Bridgewater’s future. What’s next in terms of D&I?

Bowser: I think we're at an important pivot point.  If you’re really committed to D&I, it’s not a program that you launch in one year and declare victory the next.  It’s a journey.  And when you step back and look over time, you can see an arc to the journey. 

Some time ago diversity and inclusion were viewed through more of a compliance lens.  From there, most companies have moved into more of a programmatic phase, where there's a commitment to making diversity and inclusion a priority.  That can start with things like setting up affinity groups, reviewing and modifying policies and launching training programs.  By and large, those are things that can be driven by the few and the willing as long as it’s supported by a strong commitment from the top.

The next phase is where things start to accelerate, when diversity and inclusion become priorities for the leadership across the company.  You've gone from the few and the willing to having all of your leaders pull on the oar and try to move the boat forward.  That’s where we are now.  I think we're past the start of that phase, but I'm not yet prepared to say we’ve conquered it.  It includes things like setting aspirational goals for your entire organization – where do you want to be on representation and inclusion in, say, three to five years?  What accountabilities will leaders have? And how will we help ensure success? 

And then, ahead of us, there’s the last phase, where diversity and inclusion just become embedded in the way the business runs.  It becomes an inherent part of everybody's responsibility.  Everyone understands the importance of D&I and they’re committed to doing their part to achieve success.

Our CEO says that when he looks down the mountain, he feels good about what we’ve been able to achieve so far.  But when he looks up the mountain, there’s still a lot of work to do, and we’re committed to continued improvement.

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Andrew Thorne

Andrew Thorne

Partner, US Asset Management, PwC US

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