Morgan Stanley Launches Tool Kit to Support Diversity in Investment

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11 June 2021

Morgan Stanley Wealth Management has launched a Racial Equity Investing Tool Kit as part of its Investing with Impact Platform.

Investors will now have access to a range of investments and supporting resources to advance the goals of racial equity and social justice.

The kit will also prioritise investment strategies that minimize or avoid exposure to companies, sectors or geographies with lagging racial equity records, from companies lagging in diverse representation or that provide services that are harmful to communities of colour.

According to a survey conducted by Morgan Stanley Institute for Sustainable Investing, 71 per cent of individual investors identify multicultural diversity, which incorporates elements of race, ethnicity and culture, as an area of interest for their investment portfolios.

This complements recent research which found that two-thirds of business leaders say they have already started replacing suppliers in the last year that don’t live up to their corporate social responsibility values.

The Investing with Impact Platform has highlighted investment strategies that are at least 50 per cent women and/or minority-owned since 2015. 

“Morgan Stanley is committed to supporting diversity, equity and inclusion across all racial, ethnic and gender identities. The launch of the Racial Equity Investing Tool Kit is a great embodiment of values in action for our wealth management clients who have an interest in using their capital to generate positive environmental and social outcomes,” said Kara Underwood, Head of Diversity and Inclusion for Morgan Stanley Wealth Management.

“While we are excited by this groundbreaking work and the ability for our clients to invest in dimensions of diversity, equity and inclusion, we also know there is much more work to be done. To that end, last September we established an Investment Office focused on partnering with asset managers to expand our diverse manager offering as well as to systematically evaluate all managers on their approach to diversity in terms of their own talent management,” said Lisa Shalett, Chief Investment Officer for Morgan Stanley Wealth Management.

The Investing with Impact Platform

The Racial Equity Investing Tool Kit provides additional actionable insights for investors, identifying ways to mitigate risk and pursue opportunities across a number of approaches, including:

1. Diverse ownership – Investment strategies at asset management firms owned by, or with significant representation of, racial or ethnic minorities.
2. Solutions – Investment strategies that invest in managers and companies seeking to alleviate social disparities, for example: by providing access to capital, affordable housing & community services, criminal justice reform, economic inclusion, education and more.
3. Leaders – Investment strategies that incorporate a range of environmental, social, governance (ESG) criteria, including racial equity criteria focused on diverse representation across human capital, policies supportive of attracting and retaining talented diverse employees.
4. Restriction Screening – Investment strategies that minimize or avoid exposure to companies, sectors or geographies with lagging racial equity records, from companies lagging in diverse representation or that provide services that are harmful to communities of colour.

Picture: a photograph of Morgan Stanley's signage at Times Square

Article written by Ella Tansley | Published 11 June 2021

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