Gender diversity has been on the radar in the alternative investment space for some time, and the results of KPMG's recent The Call to Act: Women in Alternative Investments Report are the most compelling yet. The issues surrounding diversity in businesses are complex and the solutions may not always be easy. But the conversations are continuing, and change is becoming the norm, rather than the exception.

Money has been flooding into the alternatives investments sector thanks to the sluggish performance of other asset classes. The alternative investments industry is still dominated by men, and for it to remain competitive in the future, there must be continued progress towards a diverse work environment. Like an investment portfolio, a diverse business is a better business.

The investors who make a huge portion of the industry are driving change. The report states that 75 percent will ask investment teams about their firm's diversity efforts, compared to 60 percent last year. In addition, 37 percent will require disclosure of diversity statistics for all potential investments (16 percent last year), and 42 percent will require firms in their portfolio to improve diversity (11 percent last year). These figures show that diversity is not simply the latest trend, something to be showcased for awhile before being allowed to fade away. Rather, it is a business imperative. Alternative investment firms must embrace the change to stay competitive.

Although investor support is growing, industry-wide change will only occur when firms take practical steps to improve gender diversity. Here are some of the key findings from the report:

• Recruitment: There must be an understanding that talented individuals can come from diverse backgrounds, and as women are still under-represented in the industry, it will be necessary to look beyond the traditional sources for candidates. Additionally, only 27 percent of survey respondents said their firm required a diverse slate of candidates be considered when making hiring decisions. To address this, hiring firms need to grow and work from a diverse candidate pool. 
• Retention: Only 29 percent of respondents said their firm leaders regularly addressed the importance of diversity. Establishing an inclusive culture, with support from the top down, is essential. Management must be held accountable for meeting diversity goals, and internal groups and programs that will help women and minorities feel included should be created and supported. Parental leave is a key component in retaining women. Access to support, coaching and flexible work arrangements can also help in this regard.
• Advancement: Research shows that men tend to develop mentoring relationships more organically than women. KPMG's report bears this out: only 20 percent of women reported that they had access to a sponsor. Until diversity is normalized in the industry, providing coaching and mentorship opportunities with more senior women will remain critical.

Although KPMG's findings show that women and men agree that achieving gender diversity is an important business objective, there is much less agreement over whether enough is being done to advance women in alternative investments. 65 percent of women believe that the sector is not doing enough to advance women, compared to 45 percent of men, for example. This evidence shows that more work needs to be done for gender diversity in the alternatives investment sector. And while we have focussed on gender diversity here, diversity in all respects is an ethical and business imperative and every leader needs to ask themselves if they are doing enough.