Why Gender Diversity May Lead to Better Returns for Investors

Despite significant strides made by women in the workforce, recent research shows that the pandemic threatens to undo some of that progress. While COVID-19 has impacted all of us, it has disproportionately affected women, especially women of color. The challenges are numerous: women are more likely to work in roles eliminated in the pandemic and, women engaging in paid labor or not, often take on a greater share of household labor, including childcare. According to The New York Times, 4,637,000 payroll jobs were lost by women in the United States since the beginning of the pandemic. The same article also reports that 66% of mothers with partners say that they are chiefly responsible for childcare, compared to 24% of fathers1. Further, the gender pay gap in the US remains at 19%less than 23% of corporate board seats in Russell 3000 companies are held by women, and only 14% of fund managers are female.

Every March, Women’s History month serves as a great reminder to reflect on a year-long conversation – the current state of gender equality investing. I am heartened to see real interest and momentum across our clients in integrating gender equality into their investment decisions. According to two recent surveys from the Morgan Stanley Institute for Sustainable Investing, 63% of US individual investors2 and 67% of global asset owners3 identify gender diversity as an area of interest in allocating capital across their investment portfolios. In celebration of Women’s History month, here are a few notable factors influencing the gender investing landscape and a few resources to help with your portfolio decisions.

Source: Morgan Stanley
Author: Lily Trager