There were plenty of opportunities for women to make their mark in ETFs in the early days, recalls Joan Hill, who was a senior ETF analyst at Goldman Sachs in the 1990s — and later co-founded the Women in ETFs organization. “For me, the ETF industry was started by a woman,” she says.
Hill points to the late Patricia Dunn, who was CEO of Barclays Global Investors from 1995 to 2002. Although it was rival State Street that launched the first-ever ETF in 1993, with the symbol SPDR, The company did not work to maximize the size of its investments. It argues that first mover advantage. It was Dan who convinced her board at BGI to launch a full suite of ETFs.
Thus, in 2000, the iShares ETF brand was born. Today, under BlackRock's ownership, it is the global leader in ETFs, by assets under management.
“Men are raising their hands and working in places that are already high profile and generating significant revenue,” notes Deborah Fore, co-founder of Women in ETFs, who runs research firm ETFGI. “Women are more inclined to raise their hands and get involved in something new and cutting-edge.”
In 2014, Hill and Fuhr — who also joined the industry in the 1990s — were among five professionals who launched the Women in ETFs initiative, adopting the motto of “connect, support and inspire” to help women make big strides in the industry. Other co-founders were Sue Thompson, Michelle Mikos, and Linda Zhang, who held senior positions at BlackRock, Invesco PowerShares, and a financial consulting firm, respectively.
Now celebrating its 10th year, the organization has been described as a truly professional network for ETF professionals with over 10,000 members globally. Men are a welcome and growing part of that membership.
Prominent women have been involved in the industry from the beginning. The organization's charter was drafted by Kathleen Moriarty, an attorney who got SPDR through the SEC's difficult approval process — giving her the nickname Spider Woman.
Early board members included Valerie Bodson, now CEO of Amundi, and Rachel Lord, then head of iShares for Europe and the Middle East and now head of international at BlackRock.
Many of the senior women know each other through the conference circuit and “wanted to share their networks and success with others,” explains Mikos, managing director of ETF due diligence at Invesco.
She says the ETF industry was ready for a professional network because of the multiplicity of players involved, including asset managers, broker-dealers, index providers and exchanges.
There was a “volcanic eruption of interest” and attracting members was never a challenge, Mikus recalls.
Growth in network members and sponsors — which now number 50, including BlackRock, State Street and Vanguard — has paralleled growth in ETF assets, says U.S. co-president Emily Mayer, who serves as vice president at Northern Trust. asset management. Morningstar data shows that global ETF assets under management have increased more than five-fold since the start of 2014, from $2.2 trillion to $11.6 trillion today.
50Number of companies sponsoring women in ETFs
The finance industry has also become more focused on diversity during this period, albeit with some recent backlash in the United States, Faure notes. There are even ETFs that specifically track companies with gender-diverse leaders and workplaces. Together, these companies have $1.3 billion in assets, according to Morningstar, the vast majority of which were launched within the past decade.
Women in ETFs attract members in emerging markets as well. South Africa is the third largest branch in the EMEA region, after the UK and Ireland – although the country's investment platforms are biased towards investment funds, says branch co-chair Michelle Noth.
Leadership opportunities are abundant with 29 chapters in total and co-chairs serve on a two-year rotation in each of the four regions – including identical twins in Canada.
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“It seems like they're always trying to create more opportunities for people at different levels, not just wait for them to get the big job,” says Jim Ross, former head of State Street ETFs.
Spain, Poland and South Korea are among the newest chapters, while the Pacific Northwest Chapter was recently launched in the United States – the first to be co-chaired by a man, Ramiro Higuera.
Looking to the next 10 years, Mayer's ambition is to reach 20,000 female ETF members and create the first chapter in South America. Rebecca Sen, co-head of Asia Pacific, said branches in China, Malaysia and Thailand are already in the pipeline.
But the most candid account of why a women's membership group is needed in the ETF industry — and why having men in the room helps — comes from Ross, an industry veteran who was behind the launch of SPDR.
“When I was in charge, we only recruited male college athletes,” he says. “I didn't even think about diversity, we were growing so fast and it wasn't top of mind.” Women in ETFs have enabled him to put himself in the shoes of his female colleagues. “I went to a breakfast party full of women and I was in the minority. I think that's how they feel when they go to a sales lunch or breakfast or dinner.
Diversity is something Ross wishes he had understood earlier in his career because “maybe he would have built a better organization.”
It wasn't until three years before his retirement, when State Street unveiled the Fearless Girl statue in 2017 — an effort to draw attention to the ETF's gender diversity, but also something that has become a symbol of ” Girl power.”
Awareness about diversity is growing across financial services, but men have become “more involved” as the ETF industry has matured, and they dominate many leadership teams, Faure says.
She says this makes an organization like Women in ETFs more important than ever. “However, what we would like to do is see more diversity among other metrics, such as race, location, and religion,” Faure suggests. “I think the statistics indicate that the financial industry in general is still not making the kind of strides it should be taking.”
