NAOS News & Insights



September 28, 2016

Impact Investing Conference Denver, Colorado - Gender Equality by Rob Miller NAOS PM

NAOS recently attended the Impact Investing Conference in Denver, Colorado. A range of topics were discussed however we found the panel discussion on gender equality particularly interesting.

The panel, four highly experienced and qualified female investment professionals, shared their thoughts on what they believe gender equality means to the investment community.

To provide some context, the United Nations has listed 17 sustainable development goals to transform our world. Goal number 5 on their list is to “achieve gender equality and empower all women and girls”. The principles behind gender equality include inclusiveness, non-discrimination & gender balance. We highlight this to illustrate the importance being placed on this issue at a global level.

In sharing their views on what gender equality means for corporate America, the consensus was that it should be promoted where it leads to optimal outcomes including diversity of thought or superior financial returns for example rather than supporting gender equality for the sake of ‘being equal’.

Key facts in relation to financial markets;

  • As of mid-2015 about 51 percent, or $14 trillion, of American personal wealth is now controlled by women, according to the Bank of Montreal’s Wealth Institute.
  • In the US, female owned businesses now account for 30 percent of all privately-owned enterprises, employing 7.8 million Americans
  • The World Economic Forum’s 2015 Global Gender Gap report shows that in the U.S., women comprise 48% of the total workforce, are more likely to graduate from college than men, and make up 53% of all graduating PhDs
  • A MSCI report which examined over 1500 companies which make up the MSCI World Index concluded that since 2010, companies with strong female leadership have delivered annual return on equity of over 10% vs those lacking gender diversity which returned on average 7%. There are numerous studies demonstrating the influence female thinking can deliver to sustained improvements to operating margins, balance sheet metrics, and share price performance compared to bottom quartile gender equality companies.
  • According to the Wall Street Journal of all S&P500 directors, females currently represents 20% & close to 75% of companies have at least two female board members yet only 3 large companies have boards with at least 50% female representation. The conference panel members believe female board representation hits ‘critical mass’ where true benefits are seen with at least 3 female board seats.

Whilst progress has been made towards gender equality & momentum continues to build, it appears there is still a long way to go. The statistics paint a clear picture though and there is a compelling case for gender equality within all levels of an organisation.

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