Los Angeles

Start Time: January 23, 2012 02:00 pm
End Time: January 24, 2012 05:00 pm

Phone: 510-628-0345

Foundations, Endowments & Emerging Managers Gather To Promote Diversity In Portfolios

RG & Associates and the Association of Black Foundation Executives (ABFE) join in thanking you for your participation at the recent Foundation & Endowment Minority and Women-owned Fund Roundup in Los Angeles.

Below are a few key event highlights and take-aways from the sessions and hallway dialogue.

We look forward to continuing to foster the dialogue between foundation and endowments (as well as their consultants and Fund of Fund firms) and minority- and women-owned investment professionals.

To access the event website, click here.

Examine Your Thinking
Whether it’s during an annual review or an informal audit process—take a closer look at the current mix of investment partners or providers you rely upon, then step back and say: WHY? Evaluate what you have done in the past 6 – 12 months to diversify your resources, to identify a larger pool of proven / qualified investment teams that fit within your strategy.

Broaden Your Scope
As Matt McCue of Emerging Manager Monthly and Non-Profit News who attended the two-day event noted, “There still is significant progress to be made in creating awareness of the benefits emerging managers can provide to institutions and how exactly to bring the two parties together.” Events like the Roundup are a start. Internal events and sessions—including a regular, once a month outreach to new managers—are also ways for teams to broaden their network and their thinking.

Merit Matters
Efforts to identify and work with more minority- and women-owned firms are not a social or politically motivated decision—the primary driver must be returns. Merit matters. Identify and nurture relationships with managers that have a proven track record, then together, build on those strengths and solid returns.

Focused Determination
Interviews by McCue at the Roundup reaffirmed the importance of intent—of staying focused on the effort as a way to drive results. “Diversity is intentional. If you don’t decide that it is at the core of your value system and that you will do whatever is necessary to see it realized, then it is not going to happen. You won’t accidentally fall into diversity,” noted William Bell, President and CEO of Casey Family Programs.

Be Intentional About  Diversity
Too often, LPs noted, investment consultants hired to identify and vet managers fail to identify “undiscovered” talent, including minority- and women-owned firms. In fact, one LP noted that he has never met a consultant who has recommended an emerging manager. Broadening the pool of talented managers to be considered will not just happen—the demand has to come from and be continually advocated for by LPs. Making it a condition of a search is simply the first step in a long, but critical shift that needs to occur.

In one of the Roundup sessions, Bruce Zimmerman, CEO and CIO of the University of Texas Investment Management Company, summarized the issue perfectly: “You are the client of a consulting firm. If you have an interest in finding undiscovered talent, if you have an interest in making sure you have a full and diverse slate of managers to look at, give your consultant that direction and they will do what their clients ask them to do.”

Judy Chambers, managing director of Pension Consulting Alliance, noted that her firm has built several large emerging manager programs on behalf of public fund clients, yet because most foundation and endowments do not have dedicated emerging manager programs, fundraising and outreach needs to take a different tact—and emerging managers need to be aware of that in order to succeed. “You need to be flexible, in particular I think if you are talking to endowments and foundations who may or may not have an emerging manager program. You are just coming in as a strong manager with a certain strategy, period,” she noted.

Snowballs & Market Momentum
As firms gain traction in securing allocations from foundations and endowments, many have experienced positive momentum within the sector. It’s what Willie Woods of ICV called the snowball effect. “This is a relationship business. It has to be some relationship or some effort by somebody to say I want to do this,” he said, adding, “Open up your minds, give people a chance and I think you will find that it will pay off,” he said.



Launched by RG & Associates and the Association of Black Foundation Executives (ABFE), the Foundation & Endowment Minority and Women-owned Fund Roundup’s mission is to
foster a dialogue between seasoned minority- and women-owned funds with leaders of the nation’s leading foundation and endowments with the goal of bringing added diversity to long-term philanthropic investment activities.