Investing in Futures
Finally – you can put your money where the women are. Here's how.
By Claire Basarich
Want to invest in a fund that invests in women? Pax World Funds has recently added the Pax World Women's Equity Fund to its mutual fund offerings. Their goal? To advance "the social and economic status of women in the workplace" by favoring investments in companies that "take affirmative steps to attract, retain and promote women and advance gender equity and women's empowerment in the workplace."
The Women's Equity Fund, founded in 1993 by Linda Pei, president of FEMMX Financial Co., was the first mutual fund to select companies based on their policies toward women's social and economic equality. Shareholders approved its merger into the Pax World Women's Equity Fund earlier this year. In addition to investing in companies that advance women to top positions and have female representation on boards, the fund will avoid companies that exploit or demean women, or that have a history of discrimination and harassment.
As it turns out, investing in women-friendly companies pays. A recent Catalyst report found that Top 500 companies with high female representation on boards showed better financial performance on average than those with the lowest representation.
Sujatha R. Avutu, portfolio manager for the Pax World Value Fund, will also be managing the Pax World Women's Equity Fund, whose investment objective is to seek "long-term growth of capital by investing primarily in equity securities." The fund is similar to other mutual funds in that it allows investors to lower risk by investing in a pool of companies from diversified industries. This fund stands out, Avutu says, because of its unique and rigorous approach to finding companies that implement practices of promoting, compensating and training women, helping them develop their careers and also addressing Life/Work balance issues such as health, childcare and flexibility.
"Females [often quit their jobs] because of the lack of supportive programs," Avutu says. "It's startling. The cost of hiring and retraining employees is very high. If the objective is to outperform peers, why not use the tools a company has?"
Client response has been overwhelmingly positive, Avutu says. "This is a very innovative and new way of thinking, and there hasn't really been any mutual fund that takes this approach. From a company standpoint, this is an unexplored area." So far, investors' returns have been good, and she predicts that the fund will eventually outperform others because companies are now seeing concrete evidence that investing in women increases their bottom lines. "I believe the existence of this fund will be a positive thing [in the business world]," Avutu says. "Being able to tap into various sources of intellectual capital and bringing awareness of this to companies will be a positive thing."
Find out more about Pax World Women's Equity Fund, under "women's equity fund."