An Advisor’s Guide To Gender And Racial Equality Funds Here’s the inside scoop on funds that are of interest to clients who want their advisor to create an environmental, social and governance investment portfolio. • Anders Skagerberg
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re your clients interested in aligning their investments and values in support of gender or racial equality? Several funds launched recently that claim to promote diversity, but which of them are a good fit for your clients? Financial planning clients are expressing interest in aligning their investments with their values. Racial and gender equality issues are at the forefront of this movement. For advisors who are crafting an environmental, social and governance investment portfolio for their clients, it is essential to have the inside scoop on which funds are of interest to clients. We have counted seven funds that target gender and racial diversity, managing nearly $1.4 billion in assets. Some of these funds can be an excellent way to align your client’s investments and values. 44
Investing In Women’s Leadership
The COVID-19 pandemic had a greater impact on women than it did on men. Many women had to take on more child care responsibilities, reduce their work hours or drop out of the workforce entirely. So investing in companies that integrate women well might be a top priority for your female clients when developing an investment portfolio. Three exchange-traded funds — SHE, WOMN and FDWM — and three mutual funds — Pax Ellevate Global Women’s Leadership Fund (PXWIX), Fidelity Women’s Leadership Fund (FWOMX) and Glenmede Women in Leadership Fund (GWILX) — invest in women’s leadership. However, two of these funds — GWILX and FDWM — are tiny, with less than $30 million in assets. These funds typically select stocks based on the proportion of women in top management and director ranks. Pax Ellevate’s manager, Pax World Funds, also has engaged with companies on gender diversity issues.
InsuranceNewsNet Magazine » October 2021
Investing In Racial Justice
In the aftermath of George Floyd’s death, racial justice investing also has gained significant ground. If your clients are interested in ESG investing, racial justice investing may be at the top of their list. Launched in 2018, the Impact Shares NAACP Minority Empowerment ETF (NACP) is the only racial justice ETF.
Pax Ellevate Global Women’s Leadership Fund
Pax Ellevate is the largest and oldest gender equality mutual fund in the U.S. Launched in 1993 by ESG boutique Pax World, the fund invests in companies that advance women through gender-diverse boards and senior leadership teams. The fund was developed in partnership with Sallie Krawcheck. She is a Wall Street veteran who now runs Ellevest, a robo-advisor focusing on women’s investment needs. Pax World selects stocks from MSCI World, a global stock index. To be included, companies must have an above-average number of women in top management roles and on the board of directors. Pax
