Indian Mutual Fund Industry Lags in Gender Diversity Among Fund Managers: Morningstar Report

The assets managed by the Indian Mutual Fund (MF) industry have likely surpassed the Rs 50 trillion mark, with more than Rs 18,000 crore worth of inflows coming through Systematic Investment Plans (SIP). However, despite these impressive numbers, the industry has shown no progress in one crucial area: the inclusion of women fund managers.

As of March this year, the number of women fund managers remains the same as it was a year ago, at 42. While the overall number of fund managers has increased from 428 to 473 over the past year, this growth has been solely among male managers, rising from 386 to 431. Consequently, the percentage of women fund managers has dipped from 9.81 percent to 8.88 percent.

This stagnation is surprising, especially considering that three new fund houses entered the Indian MF industry in 2023.

However, there is some positive news regarding the value of assets managed by women fund managers. According to Morningstar analysis, women fund managers now manage assets worth Rs 6.66 crore, up from Rs 4.43 lakh crore a year ago. Last fiscal year, there was a dip in the assets under management by women fund managers due to two prominent female managers, Swati Kulkarni and Lakshmi Iyer, leaving the industry around November 2022.

Over the last three years, the Indian MF industry has added 97 fund managers, but only 12 of them were women. However, the industry has made some strides in comparison to 2017, when there were just 18 female fund managers.

Performance of Women Fund Managers

The Morningstar report highlights an encouraging statistic regarding the performance of MF schemes managed by women. Throughout the course of a year, 70% of the total open-ended assets under management (AUM) managed by female fund managers exceeded the norm for their peer group.

Similarly, 71 percent of the AUM outperformed over a 3-year period, and an impressive 93.5 percent outperformed over 5 years. This performance is commendable and suggests that women fund managers are adept at delivering strong returns.

Challenges and Opportunities

It is important to note that not all fund houses have women fund managers. The research states that the 42 female fund managers are dispersed among 21 fund institutions. There are three or more female fund managers at five fund houses, two at five, and at least one at eleven fund houses.

The Indian MF industry has shown remarkable growth in terms of assets under management and inflows through SIPs, it has lagged in promoting gender diversity among its fund managers. The performance statistics, however, suggest that women fund managers are capable of delivering strong returns, highlighting the need for greater inclusion and opportunities for women in the industry.