Thank you so much for joining us in this interview series. Before we dive into our discussion about disruption, our readers would love to “get to know you” a bit better. Can you share with us the backstory about what brought you to your specific career path?
I started my career as a physician but at my core I’m a healer. Being a healer means being a problem solver and not just with a patient when I’m in an exam room, but also when you’re thinking about healing a system. Lately, I’ve come to identify myself as a problem seeker. It’s not just solving problems that are in front of me, but identifying what could go wrong and trying to anticipate those problems. This kind of mindset is what has led me to my current career path.
What do you think makes your company stand out? Can you share a story?
While conducting the research for our book The XX Edge: Unlocking Higher Returns and Lower Risk, my co-founder Patience Mariem-Ball and I discovered that women are excellent investors and financial decision-makers. Across all types of investments, when women are at the table making asset allocation decisions, financial returns and social impact are improved. This is true because women tend to bring different skills and lived experiences to these decisions. Also, when everyone sitting around a table all look the same and have the same backgrounds, they don’t see gaps and are likely to fall victim to groupthink. We started the Diverse Investing Collective because one of the biggest problems in the finance system is the lack of diversity among portfolio managers — the people who decide which companies get invested in. Portfolio managers are 85% white men, and if you actually look at how much money men versus women have the power to distribute, it’s 12 and a half times as much money men allocate than women in the system. So, if you’re looking at changing a system, one of the most important things we can do is get different people into these jobs. With the Diverse Investing Collective, we are determined to change who allocates capital across the industry — specifically by fund management teams. Women and people of color are vastly underrepresented in the industry and yet the decisions that are made every day by these teams impact all of us. These teams decide which new companies will get investment dollars, when to pressure CEOs regarding pay equity programs and which companies will be rewarded for taking better care of the environment.
You are a successful business leader. Which three character traits do you think were most instrumental to your success? Can you please share a story or example for each?
1 . Mission Driven: I always have an end in sight that I want to drive towards.
2 . Service Leader: I recruit, nurture and cultivate a team to drive this mission.
3 . Risk-taking: I’m willing to push the envelope and try new things. I’m thankful for having the privilege to do that.
Leadership often entails making difficult decisions or hard choices between two apparently good paths. Can you share a story with us about a hard decision or choice you had to make as a leader? I’m curious to understand how these challenges have shaped your leadership.
During my career in medicine, I recognized many problems that have resulted from the lack of women in leadership. This includes the crisis in Black maternal health outcomes in the US; or that typical venture capitalists undervalued new innovations in the women’s health market; or that the most senior leaders across the healthcare industry are mostly men, even though the healthcare workforce and consumers are mostly women. My background as a physician might have encouraged me to address these problems through the lens of the healthcare system, but I recognized that the root cause of so many of these problems in healthcare are actually the result of how capital is allocated through the finance system. This is what led me to focus my attention on the finance industry. And, while there is underrepresentation of women across many aspects of the finance industry, my decision to focus on portfolio managers was the result of understanding that on a day to day basis, this is the most important opportunity to get more money flowing to solve all the problems I care about — not just for women’s health, but for the environment, education, racial justice and more.
Ok, thank you for that. Let’s now jump to the primary focus of our interview. Let’s begin with a basic definition so that all of us are on the same page. In the context of a business, what exactly is “Disruption”?
“Disruption” is about changing a system that is stuck in old ways of doing things. In any industry, whether it’s in healthcare or finance, it’s not unusual for stakeholders to be stuck to the status quo such as how businesses will always be. It takes bold action and strategies to break people free from that.
How do you perceive the role of ‘disruption’ within your industry, and how have you personally embraced it? Is it a necessity, a strategy, or something else entirely in your view?
Disruption is a necessity — without it we would still be using dial phones and encyclopedias. Many times in my career I have found measurement to be the disruptor. Once a new lever is identified that can shake things up, if you can measure it and hold a mirror up to the folks that need to change, it can be an effective way to disrupt the status quo. When you cultivate a measurement strategy and make those metrics available to the organizations that you want to change, folks can have a better understanding of their role to play. This is why one of the strategies that I always come back to is measurement.
What lessons have you learned from challenging conventional wisdom, and how have those lessons shaped your leadership style?
I’ve worked in three different industries: healthcare, philanthropy, and now finance. I’ve learned that human nature is the same across all these industries. While the specific decisions that people need to make might be different, how people work and relate to each other are very consistent. The drivers of change in healthcare are not that different from what drives change in philanthropy or in finance. Being able to draw on those consistencies and being able to talk about what I’ve learned from the healthcare industry has been very helpful to me. In many ways healthcare is ahead of the game when it comes to systems change and performance improvement. My experience as a physician and healthcare executive has allowed me to boil down some of the changes that need to happen in finance into more basic human nature and peel back the layers of industry-specific barriers.
Disruptive ideas often meet resistance. Could you describe a time when you faced significant pushback for a disruptive idea? How did you navigate the opposition, and what advice would you give to others in a similar situation?
As the founder and president of the Tara Health Foundation I was determined to allocate 100% of the assets of the foundation to our mission. This meant that we needed to develop a strategy for investing across all asset classes to have a social impact in addition to market rate financial returns. We’ve succeeded in doing this and I’ve become a very active speaker on the topic. However, most philanthropists believe that it’s impossible to invest for social impact without making concessions in financial returns. The resistance that I get from other peers and foundations is that their primary driver for how they invest their portfolios, and their goal is to make as much money as possible so that they can give more away. My disruptive position is that in fact, they can have a mission-aligned investment portfolio that’s not concessionary that makes just as much money in fact more money which amplifies their grant-making.
So how do I navigate that opposition? One thing that I do is to heavily document my own journey to be able to support my assumptions with actual outcomes. To be able to demonstrate that our portfolio with Tara Health is not concessionary and that we are outperforming the market and being willing to be transparent about that and not secretive. I give people tools to be able to do similar things. I show up with my human capital to sit down with them and say, if this is something that you think is interesting, here’s my support and I can help you do it. If I can identify early adopters who can come on the journey with me so, while my peers may not appreciate hearing the story from me as an individual or an individual organization if I can develop a coalition of others who have also been on this journey and who can also prove and document that they are outperforming the market, then it’s going to be a stronger story.
What are your “Five Innovative Approaches We Are Using To Disrupt Our Industry”?
1 . Transparency and measurement. We are shining a bright light on the lack of diversity of portfolio managers and the smaller pools of money they are managing.
2 . A clear goal. Our goal is to see 33% of AUM (assets under management) in the US managed by gender diverse and racially diverse fund management teams by 2033.
3 . Increasing demand. We know that the finance industry will never change unless their clients (the asset owners) demand it. We are building a coalition of large asset owners to demand transparency and change.
4 . Stories. This work will never be successful unless the individual stories of successful practices are made available. We are launching a robust public relations campaign to demonstrate what’s possible.
5 . Tools. We are making it easier for all stakeholders to do the right thing. This means publishing tools for asset owners to demand transparency from the finance industry, and providing tools for the finance industry to help them diversify their workforce.
Looking back at your career, in what ways has being disruptive defined or redefined your path? What surprises have you encountered along the way?
It’s extremely important to understand the barriers to behavioral change. I used to think that if you did the research and published the evidence, that people would naturally do things differently. But, evidence and data alone are insufficient to motivate people to change the status quo. You must give them the tools to make it easier to do the right thing. It’s also necessary to appeal to their hearts, so the change you are asking of them is compelling and important.
Beyond professional accomplishments, how has embracing disruption affected you on a personal level?
My work has led me to an exciting network of changemakers and brilliant thought partners. I’m proud to call many of these people my dear friends.
In your role as a C-suite leader, driving innovation and embracing disruption, what thoughts or concerns keep you awake at night? How do these reflections guide your decisions and leadership?
In order to be effective, all of the projects that I have led require convincing others to be bold and join the movements. Many others are less likely to take risks or be bold. So, my biggest risk is failing to convince others of what’s in it for them to join me.
You are a person of great influence. If you could start a movement that would bring the most amount of good to the most amount of people, what would that be? You never know what your idea can trigger. 🙂
People need to understand that we are all “investors”. Whether folks are extremely wealthy, or have a small 401(k), or they are a trustee of their alumni school — there are people making decisions on their behalf about how their assets are invested. When we all care about who is making these decisions and demand that these people are more representative of the overall population, the world will be a better place.
How can our readers further follow your work online?
You can follow me on LinkedIn, and the Diverse Investing Collective on Linkedin, Facebook or Instagram.
Thank you for the time you spent sharing these fantastic insights. We wish you only continued success in your great work!