Diversity, Equality And Inclusion In The Fund Services Industry

By Karlien de Bruin, ESG Commercial Development, Apex Group

South Africa has the Broad-based Black Economic Empowerment (B-BBEE) framework in place, with a scorecard applied specifically to asset managers in recent years. The recently released Alexforbes 2022 Retirement Fund Survey indicates improved, albeit slow, transformation: out of 77 managers ranked for their BEE credentials, the number that were deemed to be Level 1 contributors totaled 49, up from 36 in the previous year’s survey.

In the EU two other frameworks exist to help enforce DEI – the Sustainable Finance Disclosure Regulations (SFDR) and – in the private equity space – the Institutional Limited Partners Association (ILPA). 

Apex Group, as a truly global business, has undertaken to apply a consistent and forward-looking approach in all jurisdictions in which we are present, including South Africa where Apex Group has recently established a presence with over 1,000 employees, via the acquisitions of Sanne Group, Maitland Fund Services, and business units of the Efficient Group. 

Our clients – private companies and their investors – are increasingly seeking to report their DEI data to various stakeholders, but often stumble at the first hurdle of understanding what data they should be collecting as well as how to collect, understand and improve it. Some of the challenges in DEI reporting include: firstly, what data to collect; secondly, how to collect it, and create reports of accuracy and integrity; and finally, what roadmap for improvements can be taken to meaningfully and measurably drive positive change? 

In the fund management industry, by partnering with a third-party provider, funds can access not only the technology and platforms they require to efficiently collect and analyse DEI data securely, but also the advice and support to help convert this data into the basis for actionable policies and strategies. Since this data refers to individuals’ personal information, it is essential that it is handled in a secure and fully compliant manner by experts who have the capabilities and experience of driving positive change for people. External, independent, specialist advisers can fulfil these requirements as part of an end-to-end solution.

Apex Group has developed a DEI solution for our private markets clients, underpinned by the latest in Artificial Intelligence, via Diversio’s AI technology. This allows our fund manager clients to benefit from seamlessly collecting diversity and inclusion data from their firm and portfolio companies. The DEI solution generates actionable insights, including detailed analysis of gender, race, ethnicity and other key DEI areas which – importantly – are fully integrated alongside wider Environmental, Social and Governance (ESG) reporting for clients, investors and regulators. You can read more about our ground-breaking ESG ratings and advisory service here. 

Our DEI Solution simplifies data capture, with 20+ easy-to-answer questions, supplemented expert support and independent data verification. Detailed analysis is given into gender, race, ethnicity and other key DEI areas, split by various seniority of employees, including management; and then DEI policies and practices are evaluated under the themes of breaches and resolutions, diversity, governance, career transparency, health and well-being.

In terms of outcomes, clients can identify, understand and engage with DEI performance across companies and investment portfolios. Crucially, gaps are identified to focus on key areas and, in addition to DEI insights and benchmarking data, the platform provides tailored recommendations and training solutions.

In conclusion, the benefits of strong DEI practices and transparency are clear. They include a competitive edge, better employee recruitment, retention and satisfaction; mitigation of risks; and an enhanced public and client reputation.

Apex Group, established in Bermuda in 2003, is a global financial services provider. With more than 80 offices worldwide and 12,000 employees in 38 countries, Apex delivers a single-source solution to provide an expansive range of services to asset managers, financial institutions, private clients, and family offices. 

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Apex Group is an authorised Financial Services Provider