Women’s Leadership Fund Aims to Profit From Women-Friendly Firms - Building Gender Balanced Business

• The Women’s Leadership Fund seeks to profit from the link between profitability and above-average representation of senior women at companies.

• The fund is run by run the Zurich-based alternative investments manager Naissance Capital and has an eight-member board including two former prime ministers in Kim Campbell of Canada and Jenny Shipley of New Zealand as well as Cherie Blair, the British barrister who is married to former Prime Minister Tony Blair.

• Naissance will base its investment decisions on gender diversity within a company’s senior management structure, relying on a wealth of studies from McKinsey & Co. and Pepperdine University that show a link between outperformance and a critical mass of senior-level women.

• The proportion of women in key roles must exceed the industry average in the company’s country by at least 20%.

• The fund said it expects to raise about $200 million by the end of 2009, largely from “ideologically inclined wealthy individuals”, and aims for $2 billion eventually.

• Fund manager Daniel Tudor said, “We thought if these companies are genuinely outperforming then it would be good to offer investors something. This is not a bra-burning exercise, this is business. But if the fund does well, then people will realise that gender diversity is a good thing. The two go hand-in-hand.”

• But the fund will also allocate up to 10% of its portfolio to companies that have done particularly poorly in hiring or advancing women, allowing the fund to push the company to do better or to criticise it at annual meetings. 


• Tudor expects the bulk of investment to be in the US and Europe, citing the clothing retailer H&M as a good example of a company that meets Naissance’s standard investment metrics as well as having near gender equality in top corporate posts.

• In Asia, he said, fewer opportunities exist, though qualifiers include ICICI Bank of India. By contrast, “A place like Japan has less than 1% women directors, so it is very hard to find companies that fit our criteria.”

• Naissance quoted Blair as saying: “Some 60 per cent of the world’s assets are managed by women at pension funds, endowments and insurance companies. They are a latent army of supporters.”

• Minimum investment is $100,000, but Naissance hopes to offer a similar retail fund for small investors in 2010.

• Management fees at the Cayman Islands-domiciled fund will be 1.5%, plus at least a 10% performance fee. The fund aims to beat the MSCI World Index by 3% annually.

• Naissance has also committed 20% of fund fees to relevant charities and possibly scholarship funds.

Sources: The Guardian, Hedge Funds Review, CPI Financial Net, The New York Times