BNY Mellon Investment Management commissioned an independent global study examining investment attitudes and behaviors, and concluded that women are less likely to invest.
The Pathway to Inclusive Investment study, was the first in a new series that will address diversity, set out to understand the barriers to higher levels of women’s participation in investing and the potential impact if investing were more accessible to women, the firm’s release said.
The research surveyed 8,000 individuals in 16 markets, as well as 100 asset managers, with combined assets under management of nearly $60 trillion.
Pathway to Inclusive Investment reveals that women are less likely to invest than men, exacerbating existing financial disadvantages and limiting women’s collective influence as investors.
It also shows that women want to invest in a way that has a positive social and environmental impact, and that if women invested at the same rate as men there could be more than $3.22 trillion of additional capital to invest globally, with more than $1.87 trillion going to more responsible investments.
By encouraging higher levels of female investment, capital could flow even further into funds with ESG objectives. More than half of women (55%) would invest-or invest more-if the impact of their investment aligned with their personal values, and 53% would invest-or invest more-if the fund they invested in had a clear purpose for good.
This is even more pronounced among younger women. According to the study, seven in ten women under 30 (71%) who already invest prefer to do so in companies that support their personal values, compared to 53% of women over 50 who invest.
On the other hand, the research identified three key barriers to women investing:
The income barrier: On average, women around the world believe they need $4,092 in disposable income each month – or $50,000 a year – before investing some of their money.
The perception that investing is inherently high-risk: Only 9% of women say they have a “high” or “very high” level of risk tolerance when it comes to investing, while 49% have a “moderate” level and 42% have a “low” tolerance for risk.
The commitment crisis: Globally, only 28% of women feel confident about investing some of their money. The industry must find ways to attract and inspire more women to invest, which in turn could increase confidence and participation in investing.
The survey of asset managers highlights the extent to which the investment industry remains male-oriented. Nearly nine in ten asset managers (86%) admit that their default investment client – the person their products are automatically targeted at – is a man.
Nearly three-quarters of asset managers (73%) believe the investment industry could attract more women to invest if the industry itself had more female fund managers, who could also be important role models. However, half of the asset managers in the survey revealed that only 10% or less of their fund managers or investment analysts are women.
Anne-Marie McConnon, Global Chief Client Experience Officer at BNY Mellon Investment Management said: “As women, we all have different obstacles to overcome to achieve our individual financial goals. Some of these are influenced by demographics and personal circumstances, but others are the result of the way the investment industry has traditionally targeted women.”
She added that the study, Pathway to Inclusive Investment, underscores that the traditional stereotype of the investment stakeholder is outdated and that young women should be considered.
“Young women are also interested in investing, but they need to be inspired to do so,” she concluded.
Por Magdalena Martínez
Por Javiera Donoso