NEPC was included in Bloomberg’s latest piece. Read more below.

The old boys’ network is costing university endowments money. Investment committees that have female majorities typically generate higher returns than committees that don’t. 

There’s something about the way women lead and the way they collaborate,” says Jolyne Caruso-FitzGerald, a 35-year Wall Street veteran and chair of the board of trustees at Barnard College, a women’s school in Manhattan. “There’s this intimidation factor on mostly male boards. They have a way of shutting down women. I wish people would just look at the data.”

To get an idea of what can happen when women make investment decisions, take a look at the Seven Sisters, a group of historically women’s colleges in the U.S. Northeast. Women hold almost 80 percent of the seats on the schools’ investment committees, according to data compiled by Bloomberg. In comparison, on state university foundation boards, whose duties include overseeing endowments, women on average held only a quarter of the seats in 2015, according to a report from the Association of Governing Boards. The Seven Sisters, which includes Barnard, reported an average 12.5 percent investment return for the year ended June 30, 2017, data compiled by Bloomberg show. The national average was 12.2 percent for the period, according to the National Association of College & University Business Officers.

In financial circles, it’s common to hear that the most important consideration is money—that the keys to the kingdom are available to anyone who can deliver a beefy return on investment. But that’s not necessarily the case when it comes to women and many finance jobs. Despite the data, women are underrepresented on committees that decide where endowment money goes.

Endowments are big business. They invest donations, supplement operating budgets, pay for capital improvements, and chip in with tuition payments for needy students. In the U.S., endowment assets total $567 billion, from Harvard’s almost $40 billion endowment to the $185 million fund at Lesley University, a neighboring school in Cambridge, Mass.

U.S. universities certainly talk the talk when it comes to diversity. Ninety-two percent of endowments and foundations agree that diverse committees drive successful investment programs, according to a 2015 study conducted by consulting company NEPC LLC. But those schools fall short when it comes to walking the walk. Diversity was ranked sixth out of seven optimal qualities when new committee members are selected (with the top consideration being investment knowledge) in the survey.

Disparities exist just about everywhere. At Barnard, six of the seven members of the investment committee, which manages $327 million, are women. At co-ed Ivy League school Columbia, where Barnard students also take classes and share facilities, the eight-person group that oversees the $10 billion endowment has one woman. Columbia spokesman Robert Hornsby declined to comment.

Cheryl Holland got her spot on the investment committee of Bryn Mawr College, another Seven Sisters school, in 1998, not long after asking why there was only one woman on it, she says. By 2004 she was chairing the committee. Now the group has eight members, only two of whom are men. “It’s a sexy committee,” Holland says. “Everyone wants to be on it.”

Caruso-FitzGerald says Barnard’s investment committee faced a difficult decision regarding divestment from unpopular political causes, an issue that student activists on campus brought to administrators. The endowment’s final decision—selling investments in companies that deny climate science—resulted in the committee dropping its longtime outside manager.