ES issues gaining more support from female fund managers
February 10, 2023
Female fund managers support environmental and social (ES) proposals more than governance proposals, according to the European Corporate Governance Institute (ECGI).
‘The Voting Behaviour of Women-Led Mutual Funds’ report revealed ES proposals are 17% more likely to receive support from women-led mutual funds.
Women are more likely to work for environmentally and socially responsible funds as 15.9% of ES funds are women-led mutual funds.
In comparison, 9.3% of non-ES funds are managed by teams comprising at least 50% women.
According to the ECGI, ES proposals explicitly related to risk are most likely to receive support from women-led mutual funds because women are statistically more likely to be risk averse.
Within ES proposals, women-led mutual funds support environmental proposals the most.
The report stated these results “are consistent with the notion that women are not only more aware of climate change and its consequences but also more willing to act on it.”
The report also revealed the voting behaviour of women-led mutual funds is improving gender diversity in companies and boards.
Women-led mutual funds are more likely to vote with management when firms are managed by a female chief executive officer.
This can influence the appointment of senior executives.
During director elections, women-led mutual funds are also more likely to support female candidates.
This is particularly notable when there is a shortage of female candidates or members in the board room.
The ECGI reported female fund managers are motivated by the willingness to promote gender diversity and representation.
As a result, increasing female representation in mutual fund management teams may lead to an increase in gender diversity across boards.
The report stated: “There is a growing emphasis on female representation in the finance industry and, in particular, in investment management. While several initiatives seek to tackle the underrepresentation of women, little is known about the implications of female representation in asset management team.”
Last Updated: 10 February 2023