Investment Management: Federal Entities’ Efforts to Increase Opportunities for Minority- and Women-Owned Asset Managers

Despite growing attention on equity in federal investment practices, minority- and women-owned (MWO) asset management firms still face steep barriers to entry. While five federal investment plans now use 61 MWO firms—more than in 2017—these firms manage only about 3% of total externally managed assets. Persistent challenges include bias toward large firms, limited access to passive fund contracts, and inconsistent demographic data collection. Although most federal entities reviewed have implemented key inclusive practices, recent executive orders may affect ongoing diversity efforts in federal asset management.