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Wed July 16, 2014
Pax Index Bets Women-Led Firms Can Beat The Stock Market
Pax World Funds, an American investment management company located in Portsmouth, is betting that companies with female leadership will outperform the stock market.
There are 406 companies in Pax’s new index fund, including Microsoft, General Electric, and Estee Lauder. Besides being well-established brands, they have one thing in common: women in leadership positions. Ninety-seven percent of all the companies in the fund have two or more female board members. In a traditional index fund, says Pax CEO Joe Keefe, women sit on only about 11 percent of board seats.
You know there’s significant research at this point showing that where women are better represented on corporate board and where women are better represented in senior company management that those companies actually perform better.
It’s not that women are better at business than men. Sorry, ladies. “What the research points to,” Keefe says, “is that diverse groups make better decisions than non-diverse groups.”
The Pax Ellevate Global Women’s Index Fund isn’t just talking the talk. It’s chaired and co-managed by Wall St. heavyweight Sallie Krawcheck, former president of the Global Wealth & Investment Management division of Bank of America.
Joe Keefe says the Women’s Index Fund has received more interest in its first month than many of Pax’s other funds. And, he says with some pride, the idea is clearly catching on. Barclay’s just launched its own index based on companies with women at the top. The Barclay’s index tracks 85 U.S. companies, and requires at least a quarter of board members be female.