Op-Ed: Social Unrest and a Daughter’s Call to Action

How can institutional investors help correct racial injustices? Tony Waskiewicz wants to know how asset allocators will take action.

Art by John Jay Cabuay

For the past five weeks, I have had the pleasure of having my 20-year-old daughter back at home with me. She is a rising senior in college and a math major spending her summer as a paid researcher working with the university’s math professors. Like most of us these days, she is able to complete her work from home on video and audio calls and by exchanging ideas and documents electronically. 

Once her work is done, she looks to unwind, which she would prefer to do by going out with friends. However, under the current circumstances, she frequently finds herself stuck at home having dinner with her dad. For her, having dinner at home with Dad is yet another curse of this pandemic; for me, it is one of the blessings of the times in which we live. As evidenced by the following.

During one of our recent dinners together, my daughter asked me, “Dad, what are YOU going to do to help our society address racial injustices?” 

She followed up her question with an observation that many people often claim they would have stood up in favor of some protest or movement in the past had they been around at that time to do so—in her example, she said that many people claim they would have supported Martin Luther King Jr. She said it is easy for people to make “I would have done something” claims, but yet so many people stand idle when a movement starts. 

“Dad, are you going to do anything or are you just going to sit back and watch?” she asked. 

Meanwhile, she told me that she was not going to stand idle. She said she was registering to vote in her first eligible election, studying issues and candidates, reviewing petitions to make sure the ones she signed aligned with her values, and researching whether or not she should join a peaceful protest march (no decision on that yet).

Well, there’s nothing like being called out and shown up by your 20-year-old daughter…

And my daughter isn’t alone. A slightly more well-known and more followed figure, Ray Dalio, recently posted on LinkedIn about the same issues.

“History has shown that the three most important forces are 1) the debt/economic cycle, 2) internal gaps in wealth, values, and politics, and 3) external conflicts that occur when countries get strong enough to challenge the existing leading world power and the existing world order,” Dalio wrote. “From studying history and comparing it with where we are, I believe that we are seeing a current confluence of 1) high levels of indebtedness and extremely low interest rates (which limits central banks’ powers to stimulate the economy), 2) large gaps in wealth, values, and politics within countries (which leads to increased conflicts within countries), and 3) rising world powers (most importantly China) challenging the existing leading world power (the US), which causes external conflict. The confluence of these three factors happened most recently in the late 1930s and resulted in a change to the world order at that time.”

I cannot help but connect my daughter’s concern and her “call to action” to Dalio’s observation of “large gaps in wealth, values, and politics, which leads to increased conflicts within countries.”

While the death of George Floyd ignited the recent fury, the truth is that hardships have been created by an economic structure and by policy responses that have fueled increases in asset prices, not incomes, (leading to the wealth gap); exasperation over continued evidence of systemic racism (leading to the values gap); and the intense and deepening chasm between the “I am right and you are wrong” left and right wings (leading to the political gap). Together, these gaps have served as kindling for this fury for years. And these issues likely served as the basis for “the large gaps in wealth, values, and politics” that Dalio sees at work today.  

From the seat of an allocator, all of this is concerning. If, as Dalio alludes, “the most recent occurrence was the late 1930s and resulted in a change in the world order,” and if he is correct that the confluence of these events is upon us, then what lies ahead for the institutions we serve and for the portfolios we manage? 

Specifically, how long can our institutions thrive under these conditions? And how long can an investment landscape remain fertile while chronic and systemic problems continue to grow worse? My hunch is not forever. 

And if we are truly long-term investors and if our respective organizations seek to exist in perpetuity, will silence on these issues be the proper response? Will “do nothing” help improve long-term investment opportunities or set up our institution for long-term sustainability? Probably not. Without a change in course, these forces will continue to exert enormous pressure on the current system until a tipping point is reached. The consequences of these pressures will eventually be felt. 

Perhaps the recent social unrest is a sign that our society is finally hitting the tipping point for the wealth, values, and political gap, which “leads to conflicts within countries” as observed by Dalio. Even if we are not at the tipping point yet, what will happen if the pace and direction of these gaps persists? Will these gaps eventually put our institutions and our portfolios in peril?  

The truth is, I have no idea. After all, these are complex issues. And the solutions to these issues will require bold thinking, the eradication of complacency, a change in actions, shifts in decision making processes, structural changes, and a sense of urgency. 

But aren’t these characteristics hallmarks of our industry? Are not bold thinking, constructive dissatisfaction, and the constant striving for improvement defining characteristics of the asset management industry? Indeed they are! So if any industry can make a difference, it’s our industry.

Specifically for allocators, we direct large sums of capital on behalf of our institutions. If “money moves the world,” and we are moving the money, we can most certainly make a difference. We can have an impact.

So this is where we need your help. Please lend us your brilliance. Please share your thoughts.

Tell us what we can and should do as allocators to correct social injustices. As allocators, what can we do to help raise up all people in our country? What can we do from our seat to ensure that winners in capitalistic competition achieve success in fair and unbiased frameworks versus ones in which one race or class of participants is disadvantaged? 

Tell us how our industry can be part of the solution. Tell us what other questions we need to ask, outline a problem, or share a concern. Better yet, provide a solution, share an idea, or pass along a suggestion. 

These issues can cut across all dimensions of the investment function, from governance structures to the constitution and protocols of the investment office and to investment strategies and the way we choose our strategic partners and managers. So please tell us if/how you, your organization, or your investment office will do anything differently going forward. If you are not making any changes, share with us what practices you already have in place that are making a difference.   

To provide your thoughts, please email allocatorsinaction@gmail.com. 

For sorting and organizing purposes, please use the subject line to indicate whether your response relates to governance, the investment office, investment strategy, partner/manager selection or some other idea. 

All responses will be completely confidential. We will summarize and share feedback with you in follow-up articles; however, we will not reveal names and organizations in those articles. 

Help our industry build an action plan by expanding this list:


  • How can I motivate my institution to proactively increase diversity on its board or investment committee?  

Investment office

  • How can we improve recruiting and hiring practices in pursuit of a more diverse investment team?

  • How can we build a thriving culture of diversity and inclusion on our investment team?

Investment strategy

  • How can we invest capital that can both generates our required rate of return while also reducing/eliminating wealth and/or values gap?

  • What if our allocation decisions are actually fueling or perpetuating the wealth gap or values gap? If so, what should we do differently?

Manager selection

  • Include a review of the manager’s diversity and inclusion initiatives as part of the due diligence process.

Correcting social injustices is not only the right thing to do, it will also give all people, our country, our institutions, and our investment landscape the best chance to thrive. Fairness, safety, and security lead to stability. Stability is an important condition for sustainability and better investment opportunities. Don’t we owe it to our next generation, our country, and the institutions we serve to work toward stability and sustainability? I believe we do. 

Your response is vital. While kneeling in silent observation for eight minutes and 46 seconds is powerful and necessary, it is not sufficient to solve the problem. We need real change. I know, somehow, our industry can be part of this change. We can be part of the solution. Tell us how. 

And I would love to look my daughter in the eye and tell her that, like her, I did not stand idle. With a father’s love, I responded to her call to action.

This feature is to provide general information only, does not constitute legal or tax advice, and cannot be used or substituted for legal or tax advice. Any opinions of the author do not necessarily reflect the stance of Institutional Shareholder Services or its affiliates.

Related stories: 

Op-Ed: An Allocator’s Role in Fighting Discrimination

Mellody Hobson: Incentivizing Better Racial Relationships


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