Verus will host its annual Emerging and Diverse Manager Diligence Days in June 2024, continuing its support for emerging, women, minority, and disabled-owned investment managers as an integral component of its manager research and selection process. 

How does Verus define an emerging and/or diverse manager?

Emerging managers:


      • Employee-owned firms with less than $3 billion in total assets under management (“AUM”). 

      • Private fund managers (private equity, private debt, and real assets) raising their first or second vehicles under $1.5 billion.

    Diverse firms:


        • Mainly characterized by levels of women and minority ownership (although Verus will be permitting managers to define their own diversity attributes during our annual Diligence Days event). 

      What are the challenges for emerging and/or diverse managers?

      According to Jeffrey MacLean, Verus’ CEO, “Too many consultants have focused unwittingly on large firms, which is a mistake, given the tremendous alpha-generating potential that can be gained with emerging and diverse managers.” This rings true in last year’s poll by Emerging Manager Monthly, where interest is shown to be low in the actual hiring of emerging and diverse managers.

      Source: Emerging Manager Monthly, April 2022


      Why is this important to Verus?

      Verus believes these firms represent a heretofore untapped source of high-conviction investment products that can be recommended to Verus clients. In seeking emerging and diverse managers, we expand the use of underutilized sources of alpha in client portfolios, encourage diversity of thought which can benefit outcomes, and purposefully avoid simplistic rules of thumb all of which improve our thinking and our processes.


      What is Verus doing about it?

      Verus is holding its annual Emerging and Diverse Diligence Days in June 2024. This gives emerging and diverse investment management firms a platform to meet with Verus’ Public and Private Research teams and consultants

      “The Verus Emerging and Diverse Manager Program seeks to expand our current coverage of emerging managers by identifying skillful small and minority-owned firms for consideration and inclusion in client portfolios,” noted Marianne Feeley, CFA, Managing Director of Public Markets. “While not a requirement, our preference is to meet with managers we have not interacted with before to further expand our knowledge base.” Due to the extended accessibility of hybrid meetings, Diligence Days meetings will take place virtually.

      Verus’ President, Shelly Heier, CFA, CAIA, spearheaded an initiative to create diversity transparency among investment consulting firms and investment managers, making diversity statistics more readily accessible. The Institutional Investing Diversity Cooperative (IIDC) started with 13 founding members and has grown to 27 members over the last three years. The IIDC is responsible for the stewardship of more than $43 trillion in assets* held by institutional retirements plans, endowments, foundations, employee health funds, operating funds, and capital reservices, among others. Most recently, the IIDC endorsed the recommendations by the Subcommittee on Diversity and Inclusion of the SEC Asset Management Advisory Committee.

      “The IIDC determined that it was important for the organization to provide input because our member firms are directly affected by the recommendations as we are the ‘Consultants Who Recommend Investment Advisers and Investment Funds’ referenced in section III.A.3 of AMAC’s recommendation letter,” stated Ms. Heier in the 10/22/22 statement issued on the IIDC’s website. She went on to say, “We agree asset owners would benefit from improved transparency on diversity statistics of registered advisors, due diligence processes such as how filters or screens are utilized in manager selection process, and information on how diverse asset managers are included in research, searches, and recommendations.”

      *based on membership as of 1/1/2022, according to P&I rankings of 6/30/21 institutional assets

      Verus is looking forward to 2024’s Emerging and Diverse Manager Diligence Days event and having the opportunity to meet with these managers and continue to prioritize this event in the future.