Civil rights activist Reverend Al Sharpton called on the University of Michigan to release a report on the number of African Americans involved in the management of the school’s endowment in a letter to University President Mark Schlissel and Chief Investment Officer Erik Lundberg last month.

Sharpton, writing on behalf of his organization, the National Action Network, requested diversity data both on University staff managing the endowment and leadership of the asset management firms the University works with.

Citing numerous studies that show women and people of color are underrepresented in asset management despite performing at the same level as their peers, Sharpton argued that increasing diversity is not just a matter of moral responsibility, but “a question of fiduciary responsibility.”

“If a trustees’ responsibility is to maximize returns, why are elite institutions using women and people of color at palpably low rates?” Sharpton wrote. 

Robert Sellers, vice provost for equity and inclusion and chief diversity officer at the University, responded to Sharpton’s letter by reaffirming the University’s commitment to diversity, equity and inclusion.

“The University is currently in the midst of a planning process where every school, college and campus unit created a diversity, equity, and inclusion strategic plan addressing its unique local needs and opportunities,” wrote Sellers. 

Sharpton cited a December University of California report on its diverse investment strategy as a model for the University and institutions across the country. The report detailed the UC Investment Office’s workforce diversity trends by racial and gender makeup, the number of minority- and women-owned investment partners and a qualitative survey of diversity and inclusion approaches at 15 of its largest investment partner firms. 

In an interview with The Daily, Sharpton offered advice to students on how to advocate for the University to lead on diverse asset management as well. 

“They should demand transparency and they should demand to know,” Sharpton said. “If they, in fact, get the data and there is not enough diversity, they should demand that there be an aggressive move to try and correct that without sacrificing the return on investment.”

Sharpton told The Daily that reporting on the diversity of asset management would help the University sustain its investments while growing closer to its core values of diversity, equity and inclusion. 

“One, it could bring them people that could perform better, so they would benefit financially,” Sharpton said. “And second, it would show that they frankly practice what they preach … It should be firms that can show that they can outperform or perform at the level of those agencies or companies that they were already dealing with. We’re not asking for charity here, but we’re asking for a lack of exclusion, and there must be an aggressive move toward that end.” 

Robert Raben, founder and president of the consulting firm The Raben Group, founded the Diverse Asset Managers Initiative in 2014 and works with NAN to increase the number of, and assets under management by, minority- and women-owned asset management firms, according to its website. He praised the UC report for being the first of its kind among major universities. 

“I give them nothing but points,” Raben said. “Their numbers are low and they still put them out because they want to improve, whereas Michigan won’t even engage in the conversation.”

According to Raben, universities are the last major entity in the economy to widely release data on asset management diversity. 

“There’s something very odd going on that an entire field won’t even talk about whether it’s working with women or people of color,” Raben said.

The University’s endowment was valued at $12.4 billion in June 2019, the ninth-largest in the country and third-largest among public universities nationwide. Sharpton also sent letters to other institutions with large endowments such as Yale University and Harvard University

Raben said he believes lobbying large, established universities will create a domino effect in diverse asset management reporting.

“There’s hundreds of billions of dollars in university endowments,” Raben said. “Our theory is that if Cal and Harvard and Michigan and Cornell and Stanford, Texas, etc. recognize that they’re missing out on talent and performance, then the rest of the field will follow. So, number one, we’re dealing with Michigan because of its importance in the field.”

Student activism led the University to freeze new fossil fuel investments in February, a first for a Big Ten school. 

Diverse asset management is not an easy ask for chief investment officers, according to Raben. He said firms that university asset managers already work with have an incumbency advantage, making it hard for diverse-owned firms to enter investment pools. 

“If I was persuaded that I should work with people of color or women, it means I would have to take $100 million or $500 million from somebody,” Raben said. “There’s no new money. And so it would mean that the CIO would have to go to JP Morgan or Carlyle or KKR or whomever it’s been working with for 20 years, and say ‘I want to move 100 million or 500 million from you to a Black asset manager.’” 

The University’s website states the endowment is shielded from “political pressures” and investment decisions are based solely on financial factors. Additionally, Schlissel told The Daily in a Feb. 25 interview he doesn’t believe the University should shift the direction of endowment funds in response to the political beliefs of the student body. 

“I think that’s both inappropriate and very risky,” Schlissel said. “You know, in a world where we value free speech and we value diversity, I think I can disagree with the owner of a business but still do business with the business. So, I don’t think those things should enter into investment decisions at all.” 

Raben’s initiative recently surveyed the top 30 investment consulting firms in the nation on their diversity data. However, he said conversations with University officials have not been as productive as those with private industry. 

“When I talked to (Lundberg) two years ago, he told me that he was willing to work with us, but he also told us that he didn’t engage in social engineering,” Raben said. “I took offense to that. I said, ‘I don’t think working with talented people of color is social engineering.’ He said his board, his Regents instructed him not to engage in social engineering. And I said, ‘If you’re only curating white people, would you consider that social engineering?’ He did not respond.” 

University spokesperson Rick Fitzgerald did not offer further comment on Raben’s conversation with Lundberg.

Lundberg’s 2019-2020 base salary was $850,000, the sixth-highest at the University, according to the annual Salary Disclosure Report. Raben noted that CIOs are often among the highest-paid officials in universities and said their decisions are typically unquestioned by asset managers and trustees. 

“This is the mindset of some of these CIOs, that a conversation about working with people of color is some sort of social experiment, like it’s 1941,” Raben said. “In every other area of American economic life, corporate boards, c-suites, employment — white people don’t quibble with the premise of diversity anymore. Nobody quibbles with whether or not having Black people, Hispanic people in your employment is a bad idea. But in asset management, and the CIO of Michigan, they dispute the premise. They don’t think it matters whether or not talented people of color are included. And I’m just astounded by that.”

Reporter Calder Lewis can be reached at

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