Male focus is costing global wealth industry $3 trillion in AUM

If investment firms helped make investing more accessible for women, the returns would be significant says BNY Mellon

Male focus is costing global wealth industry $3 trillion in AUM
Steve Randall

The global wealth management industry is missing out on a rich source of clients according to a new study published today.

A global survey from BNY Mellon commissioned one of the largest global studies into investment attitudes and behaviours and gained some valuable insights into the barriers for women investors.

It found that the industry is losing out to around US$3 trillion in AUM by not addressing these barriers and making investing more accessible to women.

It also uncovered a significant bias in how investment products are targeted to customers.

The survey of more than 8000 individuals including 100 asset managers revealed three key barriers that stop women investing:

  1. Money - women, globally, believe that they need an average $4,092 per month of disposable income ($50K per year) before they start investing.
  2. Risk – with just 9% of women saying they have high risk tolerance to investing, 49% moderate risk tolerance, and 42% low risk tolerance. Women tend to assume investing is inherently high risk.
  3. Confidence - just 28% of women globally feel confident in investing. The report calls on the industry to do more to engage and inspire women to invest.

"Looking at the research, it's clear that increasing women's participation in investment is critical for their personal prosperity and to help shape a more equitable future for all,” said Hanneke Smits, CEO of BNY Mellon Investment Management. “Doing so will also potentially help increase the allocation of capital for the benefit of society and the environment.”

Women want their money to do good

Another of the key findings of BNY Mellon’s Pathway to Inclusive Investment study is that women – like a growing share of all investors – want their investments to do good.

The survey found that 55% of women would invest (more) if the impact of their investment aligned with their personal values, and 53% would do so in a fund with a clear purpose for good.

For women under 30, alignment with personal values is even more important – 71% of current investors in this group vs. 53% for women investors over 50.

Inclusive industry

The report also highlights the uneven gender focus and headcount mix in the investment industry.

More than 9 in 10 asset managers admitted that they automatically target their investment products towards men by assuming them to be their default customer.

Developing more female fund managers would have a marked difference to the ability of the industry to attract women investors according to three quarters of respondents. However, currently they say that women make up 10% or less of their fund managers or investment analysts.

Last November, Wealth Professional revealed our 5 Star Leading Women In Wealth.

"As women, we all have different hurdles to overcome to meet our individual financial goals,” said Anne-Marie McConnon, Global Chief Client Experience Officer at BNY Mellon Investment Management. “Some of these are influenced by demographics and personal circumstances but some is a result of how the investment industry has traditionally engaged with women.”

She added that it’s in everyone’s interest for more women to invest.