This is the fifth Women and Money post in a series about gender lens investing. All are available at www.financialfreedomparty.com.
The first post introduced the concept of investing through a screening process referred to as a lens. The second gives an overview of socially responsible investing as an established type of lens investing. The third answers the question “Why gender lens investing?” and promises to look at the role of board of directors (also referred to as the board) and high level business executives in publicly traded companies. The fourth post, gives a brief overview of each of these two leadership groups and shows why they are important in understanding how gender lens investing works. This fifth post describes some specific criteria being used by one investment company as its way to screen companies, or simply how they apply the gender lens. Those companies who meet the gender lens criteria are then eligible to be considered as part of the investment.
Once again I remind you, this blog is educational in nature and does not give investment advice. The intent is to give an overview of gender lens investing and how it works. If you find the investment mentioned here to be something that interests you, then please seek professional advice and go through the normal process of determining whether or not it is appropriate for you.
Much of the material on investing is technical and precise. Rather than trying to re-state it correctly, most of this post will refer you to the source documents through a series of links for you to click on. It is the best way to learn, even if it may seem just a little tedious at first. If you choose not to follow the links, all the pieces of this puzzle- like study won’t fit very well. Your choice of course.
Pax Ellevate Global Women’s Index Fund is an example of gender lens investing. If there are similar funds out there, I have yet to find them. Since this one is leading a new way of thinking, it is a good place to start learning the details.
The link which will guide you in understanding who is involved in the development of the fund referenced above, why it was created, and how it works can be seen by clicking here.
An overview of how companies are screened, or how the gender lens is applied, is briefly described below:
Each company gets the cumulative ranking based on five criteria of gender leadership. These include the number of women representatives on boards of directors or in executive management, as well as those who have a female CEO or CFO and have signed the Woman’s Empowerment Principles, a joint initiative by the UN Global Compact and UN Women that provides guidance for companies on how to empower women in the workplace.
Besides these criteria, companies must also meet key environmental, social and governance standards…
Not familiar with The Woman’s Empowerment Principles? I wasn’t either, They are summarized below:
The entire document may be viewed by clicking here.
Finally, more details are available by clicking here to link to the
- Fund Fact Sheet
- Fund Profile
You will probably find the Fund Fact Sheet and Fund Profile to be the easiest to understand. However, the Prospectus is also a very important document. Not sure what it is? Next time I’ll go into details about a prospectus and why it is a valuable document to you as a potential investor or investor.
To summarize, this series of five blogs has:
- Given a quick lesson on the concept of investing through a screening process referred to as a lens.
- Explained the characteristics of the board of directors and C-level executives in publicly held companies
- Shown how one firm is applying a gender lens to companies based on their ratio of women to men in leadership positions and the acceptance of practices as stated in the Women’s Empowerment Principles.
- Provided links to additional and more detailed information on a mutual fund, Pax Ellevate Global Women’s Index Fund, which is the example used in these posts.
It will be interesting to see how this concepts spreads and impacts the world of big business and the quality of the lives of both women and men.
Please share this information with those around you.
Until next time.
(This information is designed to educate you about basic financial management concepts. Questions relevant to personal finances specific to the individual should be address to an appropriate professional to ensure that the situation has been evaluated carefully and appropriately. The Authors and Publisher specifically disclaim any liability loss, or risk which is incurred as a consequence directly or indirectly from the use and application of any contents of this work.)
Copyright2014©by Debra Hadsall