Logo for InfluenceWatch InfluenceWatch

Donate
For-profit

State Street Global Advisors

Type:

For-profit Investment Manager
President and CEO:

Cyrus Taraporevala
Location:

Boston, Massachusetts

Contact InfluenceWatch with suggested edits or tips for additional profiles.

State Street Global Advisors is a large investment management company headquartered in Boston, Massachusetts that manages more than $3.89 trillion in global assets. The firm is among the largest money management firms in the world and employs 40,000 employees across 40 global offices. The firm was founded in 1978 and is a wholly owned subsidiary of State Street Corporation. It focuses on providing Electronically Traded Fund (ETF) investment tools. 1 2

The firm has embraced left-leaning Environmental, Social, and Corporate Governance (ESG) investing practices and instituted diversity hiring quotas. The firm has described its greatest “systemic risks” as ones imposed by climate change as well as an absence of ethnic and racial diversity within the firm. In 2021, it was reported that the firm had changed hiring practices to require special permission before hiring white males as executives. In 2017, the firm placed the “Fearless Girl” statue across from the Wall Street “Charging Bull” statue in New York City, a move that was criticized by the Charging Bull artist. The firm has also donated to left-leaning causes and organizations through its charitable arm, the State Street Foundation. 3

Background

State Street Global Advisors was founded in 1978 by State Street Corporation to provide investment services to its customers, with a focus on U.S. domestic and international equity index funds and cash. In the 1980s, the firm rolled out quantitative indexing strategies for customers and opened its first international locations in London and Hong Kong. 4

In the 1990s, the firm partnered with the American Stock Exchange to launch the first U.S.-listed exchange traded fund (ETF), which remains the largest ETF on the market as of 2021. The firm also launched other ETFs across various industries and regions and in 2000 it launched its official institutions group to manage assets for foreign governments’ central banks and sovereign wealth funds. The group today manages more than $529.5 billion for 72 governmental and sovereign clients. 5

In 2015, the firm expanded its ESG investing practices with the launch of an S&P 500 “fossil-fuel free” index fund. The following year, the firm launched a “gender diversity index” and affiliated ETF. In 2017, it began a campaign calling for gender quotas for corporate boards which coincided with the placement of the “fearless girl” statue in the New York City financial district. 6

“Fearless Girl” Statue

In 2017, State Street Global Advisors commissioned and placed a statue titled “Fearless Girl,” depicting a young girl standing across from the famed “Charging Bull” on Wall Street outside the New York Stock Exchange. A nearby plaque called for greater representation of women in the financial services industry. 7

The statue was criticized by the artist of the charging bull who alleged it painted his statue in an unintended menacing light. The firm was later criticized when it sued the artist who crafted the statue claiming that the firm and not her owned the rights to the statue’s likeness and name. 8

Gender Discrimination Settlement

In 2017, the same year it sponsored Fearless Girl, State Street Global Advisors reached a settlement with the Department of Labor in which the firm agreed to settle claims that it had discriminated against 305 female employees by paying them less than men in similar positions. The Labor Department also had claimed the firm had been paying 15 Black vice presidents less than their white counterparts. 9

The firm agreed to pay a $5 million settlement to the affected employees and extended back pay from 2010. 10

Diversity and Inclusion

State Street Global Advisors has adopted left-leaning “Diversity, Equity, and Inclusion” (DEI) practices both within the firm and in its investment tools. In November 2021, the firm launched its “Opportunity Class,” which was framed as allowing clients to support “inclusion and diversity” initiatives with their investments. 11 12

The firm had previously described itself as being “an active voice in the investment management community on integrating racial equity and social justice issues into investment and engagement activities.” The firm sent a letter to corporate board chairs in 2020 informing them that it begin to ask companies in its investment portfolio questions about their strategy relating to racial and ethnic diversity. 13 14

The firm launched an action plan in 2020 that included racial sensitivity trainings for staff. 15

The firm also announced that it would begin to donate 20 percent of its net management fees annually to left-leaning advocacy and charitable organizations that align with the firm’s “racial equity and social justice” values. As part of its giving, the firm gave $5 million to launch the New Commonwealth Racial Equity and Social Justice Fund. The firm also operates the State Street Foundation, which funds left-leaning advocacy groups. 16 17 18

Hiring Quota Controversy

In November 2021, it was reported that State Street Global Advisors would require special permission to hire white men as part of an effort to triple the number of Black, Asian, and other ethnic minorities in senior positions by 2023. It was announced that recruiters would have to establish panels of four or five employees which must include a woman and a minority employee when hiring middle management staff as well. 19

The firm said that it wasn’t requiring special permission in order to hire white men but rather that the hiring team would need to prove that minority and women candidates were interviewed. The firm also said that executives would face lower bonuses if they didn’t meet the firm’s goal of tripling women and minority executives by 2023. Jess McNicholas, the firm’s head of inclusion, diversity, and corporate citizenship stated that the initiative was “now front and central for State Street—it’s on every senior executive’s scorecard.” 20

References

  1. Colton, Emma. “One of world’s largest investment firms will need permission to hire White men.” Fox Business. November 7, 2021. Accessed December 9, 2021. https://www.foxbusiness.com/lifestyle/state-street-global-advisors-permission-hire-white-men
  2. “Our History.” State Street Global Advisors. Accessed December 9, 2021. https://www.ssga.com/us/en/institutional/etfs/about-us/our-history
  3. Colton, Emma. “One of world’s largest investment firms will need permission to hire White men.” Fox Business. November 7, 2021. Accessed December 9, 2021. https://www.foxbusiness.com/lifestyle/state-street-global-advisors-permission-hire-white-men
  4. “Our History.” State Street Global Advisors. Accessed December 9, 2021. https://www.ssga.com/us/en/institutional/etfs/about-us/our-history
  5. “Our History.” State Street Global Advisors. Accessed December 9, 2021. https://www.ssga.com/us/en/institutional/etfs/about-us/our-history
  6. “Our History.” State Street Global Advisors. Accessed December 9, 2021. https://www.ssga.com/us/en/institutional/etfs/about-us/our-history
  7. Stevens, Matt. “Firm Behind ‘Fearless Girl’ Statue Underpaid Women, U.S. Says.” New York Times. October 6, 2017. Accessed December 9, 2021. https://www.nytimes.com/2017/10/06/business/fearless-girl-settlement.html
  8. “Fierce Battle over Who Owns Rights to ‘Fearless Girl’ Statue.” Art World. Accessed December 9, 2021.  https://news.artnet.com/art-world/fearless-girl-battle-australia-1717359
  9. Stevens, Matt. “Firm Behind ‘Fearless Girl’ Statue Underpaid Women, U.S. Says.” New York Times. October 6, 2017. Accessed December 9, 2021. https://www.nytimes.com/2017/10/06/business/fearless-girl-settlement.html
  10. Stevens, Matt. “Firm Behind ‘Fearless Girl’ Statue Underpaid Women, U.S. Says.” New York Times. October 6, 2017. Accessed December 9, 2021. https://www.nytimes.com/2017/10/06/business/fearless-girl-settlement.html
  11. “State Street Global Advisors Launches Inclusion and Diversity-Focused Money Market Share Class.” ESG Today. November 16, 2021. Accessed December 9, 2021. https://www.esgtoday.com/state-street-global-advisors-launches-inclusion-and-diversity-focused-money-market-share-class/
  12. “10 State Street Action Addressing Racism and Inequality.” State Street Global Advisors. Accessed December 9, 2021. https://www.statestreet.com/values/inclusion-diversity/10-actions-to-address-racism-and-inequality.html
  13. “State Street Global Advisors Launches Inclusion and Diversity-Focused Money Market Share Class.” ESG Today. November 16, 2021. Accessed December 9, 2021. https://www.esgtoday.com/state-street-global-advisors-launches-inclusion-and-diversity-focused-money-market-share-class/
  14. “10 State Street Action Addressing Racism and Inequality.” State Street Global Advisors. Accessed December 9, 2021. https://www.statestreet.com/values/inclusion-diversity/10-actions-to-address-racism-and-inequality.html
  15. “10 State Street Action Addressing Racism and Inequality.” State Street Global Advisors. Accessed December 9, 2021. https://www.statestreet.com/values/inclusion-diversity/10-actions-to-address-racism-and-inequality.html
  16. “10 State Street Action Addressing Racism and Inequality.” State Street Global Advisors. Accessed December 9, 2021. https://www.statestreet.com/values/inclusion-diversity/10-actions-to-address-racism-and-inequality.html
  17. Leung, Shirley. “Eastern Bank, State Street each give $5m for racial equity effort led by Black and brown executives.” Boston Globe. July 22, 2020. Accessed December 9, 2021. https://www.bostonglobe.com/2020/07/22/business/eastern-bank-state-street-each-give-5m-racial-equity-effort-led-by-black-brown-executives/
  18. “State Street Foundation.” State Street Global Advisors. Accessed December 9, 2021. https://www.statestreet.com/values/corporate-citizenship/state-street-foundation.html
  19. Colton, Emma. “One of world’s largest investment firms will need permission to hire White men.” Fox Business. November 7, 2021. Accessed December 9, 2021. https://www.foxbusiness.com/lifestyle/state-street-global-advisors-permission-hire-white-men
  20. Colton, Emma. “One of world’s largest investment firms will need permission to hire White men.” Fox Business. November 7, 2021. Accessed December 9, 2021. https://www.foxbusiness.com/lifestyle/state-street-global-advisors-permission-hire-white-men
  See an error? Let us know!