The Securities and Exchange Commission’s Asset Management Advisory Committee approved several recommendations this week to improve diversity and inclusion in the industry.
“The asset management industry has a lot of work to do to increase racial and gender diversity,” said Gary Gensler, chair of the SEC, in a statement.
The SEC Subcommittee on Diversity and Inclusion made several recommendations this week, including requiring investment advisors to disclose the gender and racial diversity in their workforce, officer ranks and ownership ranks on Forms ADV.
The subcommittee also recommended the SEC require investment companies to disclose gender and diversity makeup of their fund boards, in addition to their workforces, officer ranks and ownership ranks of advisory and subadvisory firms.
“Of the $70 trillion in global financial assets under management across the investment universe, less than 1% are managed by minority-owned or women-owned firms,” the subcommittee said, in its report. “Independent from AUM, across the industry of asset management firms, percentages of ownership interests by women and people of color in asset management firms remains startlingly and disproportionately low, by any and every objective measure.”
Many financial advisors, concerned about this lack of diversity, have made efforts to rethink the way they vet asset managers.
SMArtX Adds 56 New Strategies
Turnkey asset management platform SMArtX Advisory Solutions announced this week it has added 56 new strategies and proprietary ETF model portfolios to its platform, bringing its total number of strategies to 832.
The new strategies come from Ballast Equity, Crosspoint Capital Management, Frontier Asset Management, Lyons Wealth Management, McElhenny Sheffield Capital Management and SMArtX Advisory Solutions. Existing management firms include Henry James International Management, Krane Funds Advisors, Lazard Asset Management, Stringer Asset Management, T. Rowe Price and Toews Corporation.
SMArtX says its assets under management, now at $16.5 billion, have grown 864% over the trailing 12 months. The firm also recently launched proprietary outsourced chief investment officer (‘OCIO’) ETF Target Allocation Strategies.
“These new offerings enable independent financial advisors and firms to access a wide range of strategies across international and emerging markets, target allocation models, tactical strategies, and sector exposures in one easily run unified managed account (UMA),” the firm said, in a statement.
J.P. Morgan Launches Two Nontransparent Active ETFs
J.P. Morgan Asset Management announced this week it has added two new nontransparent active ETFs to its ActiveBuilders ETFs equity suite. The new JPMorgan ActiveBuilders U.S. Large Cap Equity ETF (JUSA) and JPMorgan ActiveBuilders International Equity ETF (JIDA) join the existing JPMorgan ActiveBuilders Emerging Markets Equity ETF (JEMA).
“Whether it is retail investors looking to meet their retirement goals, or sophisticated asset allocators who are seeking to differentiate their portfolios by going beyond fee budgets, ActiveBuilders offer another way to enhance equity exposure while managing costs and potentially avoiding outsized manager risks,” said Bryon Lake, head of Americas ETF client at J.P. Morgan Asset Management, in a statement.
J.P. Morgan now has a total 36 ETF products with more than $64 billion in assets under management.