Less than 20% of the assets held by major foundations is invested by outside firms run by women or people of color, according to a report released Thursday.

Commissioned by the Knight Foundation, the report found that 30 of the largest grantmakers deployed a total of $11 billion, or 16.6% of their endowment investments, with firms controlled by women or people of color.

Using a diverse pool of investment managers has many benefits, said Juan Martinez, Knight’s chief financial officer. Diverse investment managers often put money into investments that white money managers don’t, which can add balance to an investment portfolio. And, he said, paying diverse asset managers had the benefit of creating wealth among finance professionals who have faced barriers to succeed.

In a previous study of the broader asset management field, Knight found that less than 1% of the nearly $70 trillion of assets under management in the United States was managed by diverse asset-management firms.

“This sector is investing with diverse managers at a much higher rate than the overall field,” Martinez said. “But the overall field is pretty paltry.”

Four grant makers, Casey Family Programs, the Knight Foundation, Silicon Valley Community Foundation, and the Tulsa Community Foundation/George Kaiser Family Foundation, each had more than one-third of their assets managed by a diverse investment firm. The Tulsa and Kaiser foundations are separate entities, but George Kaiser is a major donor to the Tulsa Community Foundation. Knight commissioned a similar study last year. The current report cannot be directly compared with last year’s data, however, because the two studies used different definitions of diverse ownership. In the previous study, an investment firm was considered to be diverse if it had at least one partner who was a woman or a person of color. The bar for diverse ownership in the current study was raised to 50% ownership by women or people of color.

If the current threshold for diverse ownership was applied to the 25 foundations that participated last year, investments managed by diverse-owned firms would have shown a 1% increase this year.

The study, conducted by data research firm Global Economics Group, attempted to compile investment data from the nation’s 55 largest private, community, and operating foundations. As was the case last year, several foundations either declined to participate or did not respond to requests for information.

Eight of the grantmakers that declined to participate have their own in-house investment teams. The Robert W. Woodruff Foundation, for example, wrote in comments accompanying the report that it favors “passive strategies and low-cost index replication” that don’t require extensive use of outside asset managers.

The Gates Foundation, the largest private philanthropy in the United States with about $50 billion in assets, participated, but the study did not identify any assets the foundation had steered to investment managers led by women or people of color. The foundation uses outside asset managers only for “a sliver” of its investment portfolio, the foundation said in comments included in the study.

“While we are grateful the study calls attention to this very important issue, it does not accurately capture how we manage our portfolio or our commitment to women and minority-owned asset managers,” wrote the foundation.

The increase in the number of foundations that responded is a good sign, said Knight’s Martinez.

“They were willing to share data, which we think is a first step to really meaningfully tackle this issue.”

Robert Raben, executive director of the Diverse Asset Managers Initiative, said foundations have done a poor job of providing data on the diversity of their investment consultants. The initiative is supported by high-net-worth donors and foundations including the Ford Foundation and the Rockefeller Brothers Fund, Raben said. The Knight study and the increased participation by larger foundations could encourage a greater number of grant makers to be more forthcoming about their diversity efforts.

Said Raben: “In a country which is rapidly diversifying, the opaque field of asset management, which is high stakes, high dollars, is a stubborn holdout.”

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This article was provided to The Associated Press by the Chronicle of Philanthropy. Alex Daniels is a senior reporter at the Chronicle. Email: alex.daniels@philanthropy.com. The AP and the Chronicle receive support from the Lilly Endowment for coverage of philanthropy and nonprofits. The AP and the Chronicle are solely responsible for all content. For all of AP’s philanthropy coverage, visit https://apnews.com/hub/philanthropy.