In a world of finance dominated by men, there is one corner where women are in charge.
The UK’s largest pension fund, one of its biggest managers of local government pension assets, its pensions lifeboat and the investment strategy of its largest defined contribution “master trust” are all run by women.
In the US, the top job in three of the country’s biggest pension funds — California State Teachers Retirement System (Calstrs), The California Public Employees’ Retirement System and New York State Common retirement fund are, similarly, held by women.
“Of all the parts of financial services, pensions to me feels like the one where you feel like you have the most direct long-term connection with the person at the end of the purpose . . . I just wonder if that does attract women more because on average they are more relational,” said Carol Young, chief executive at the Universities Superannuation Scheme, the UK’s largest pension fund which manages £78bn of assets.
A report by the Official Monetary and Financial Institutions Forum last year found that the rise of women in pensions is having a snowball effect. Of the largest 50 pension funds globally, 28 per cent are now run by women — up from 24 per cent in 2023. This puts pensions way ahead of the wider financial sector in gender parity: across 335 financial institutions in the index, which also includes central and commercial banks and sovereign funds, only 16 per cent of leaders were women in 2024.
What’s more, the share of women in C-suite positions in pension funds grew three times faster in funds led by women compared with those led by men over the past two years.
“The real difference is it’s a much less aggressive environment,” said Liz Fernando, chief investment officer at National Employment Savings Trust (Nest), which manages some £47bn of assets. “You are taking longer term decisions and the financial rewards are lower and less incentive-based by and large.”
Fernando added that it was “probably an environment in which raw talent and skill can get you noticed . . . In an environment that is more dog eat dog you need to be more political”.
In a recent report, survey organisation Gallup noted that while salary was important to both genders, women were more likely than men to be motivated by factors other than pay. Work-life balance and personal wellbeing was the top reason they gave when considering their next job, with 69 per cent saying it was very important compared with 58 per cent of men. Women also said they valued being able to do what they felt they did best, seeking work that fit their talents.
Women who have reached the top in pensions have come from a range of different backgrounds, from consulting and investment banking to asset management and human resources.
But all of those who spoke to the FT said they enjoyed the sense of purpose the role can bring, and the potentially flexible nature of the industry.
“Pensions is a slightly more family friendly version of a city job,” said Emma Douglas, chair of the Pensions and Lifetime Savings Association Board. “I don’t want to imply that we’re all a bunch of slackers and it’s not hard work, I just think that even pre-Covid there was a bit more flexibility about how you can use your time.”
Douglas, who is also wealth policy director at Aviva, goes out of her way to set an example and create an inclusive work environment.
“As a leader in the industry — I take my holidays, I don’t work weekends, I go home at a decent hour and I expect that to be the same for everyone that works for me,” she said. “Once you start to have a position where you are managing people you can role model some of the behaviours that you would like to see and that you as a manager benefit from as well.”
For Michelle Ostermann, who was appointed chief executive of the Pension Protection Fund, the UK’s pensions lifeboat, last April, the sense of purpose was the clincher, and the prospect of giving back as part of an industry with “significant social benefits” in the latter stage of her career.
“It’s very rewarding to me being able to apply my craft with such tangible benefits,” she said. In keeping with norms across the sector, Ostermann does not use gender diversity quotas across senior employees, but does set targets for gender balance which the team has made “exceptional progress” on.
In the US, Cassandra Lichnock, the first female chief executive of Calstrs, which has $353bn of assets, said the public sector setting of many pension schemes also provided an opportunity for growth in a way that might not exist in private firms.
“From my experience working in the public sector there is a lot of opportunity for growth and working your way up through the ranks,” Lichnock said, adding that having senior women emboldening other female staff can “challenge [them] to achieve greater things”.
Calstrs serves more than 1 million teachers working and retired in California, 72 per cent of which are women. Around 60 per cent of Calstrs’ 1,390 staff members are women, with five teachers sitting on the pension fund’s board.
“We have an academic feel, which I think is somewhat unique to Calstrs . . . the people that we are hiring thrive in a collaborative environment and that might tend to have more female connectivity,” said Lichnock, who was paid over $1mn in the 2023/24 financial year.
Paul Todd, chief operating officer of Nest Invest, says having women in leadership positions is also “incredibly beneficial” for the industry, especially given the diversity of people depending on it.
“Diversity of thought and experience leads to more creative solutions and in my experience better decisions,” he said. “Nest has over 6mn women saving for a pension with us — having a leadership that reflects its member or customer base leads to a higher likelihood of delivering products and pathways that meet these different needs.” Nest’s investment committee is chaired by Sarah Laessig and three of the four other members are women, he added.
Despite the benefits, however, the growing presence of women in pensions is not reflected in other parts of financial services. The latest global statistics found the proportion of female portfolio managers has hovered around 12 per cent over the past four years, according to industry publication Citywire.
“Becoming a pensions actuary was just a brilliant combination for a mathematician who enjoys people,” said Rachel Elwell, chief executive of Border to Coast, the pool set up to manage assets of local government pensions funds.
She said a key attraction to her current role was that it was based in Yorkshire, where she is from, and she had two “youngish” children so it meant she could be based at home with them and have a really meaningful job which contributed to the local community.
“If you look at the financial services industry — pensions isn’t all focused in London and Edinburgh and if you look globally you’ll see pension companies can be less geographically concentrated and that’s really helpful if you want to have a slightly different lifestyle”.
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