It’s Time to Invest in Her

By Joe Keefe, President and CEO, Pax World Funds

(Joe is pictured with Sallie Krawcheck, Chair, Pax Ellevate Mgmt. and Ellevate Network)

We are in a moment. The moment of Time’s Up and #MeToo. The moment of women’s marches. The moment of Harvey Weinstein and Justice Kavanaugh. The moment when more women than ever before have been elected to public office. It’s also the moment when investors have an historic opportunity to become a powerful force for advancing gender equality across the globe.

We need to build on the tumult of the last 12 months and make 2019 the year when corporations and financial markets turn decisively against gender discrimination and inequality, declaring quite simply that it is no longer acceptable. We need to make 2019 the year of investing in women.

I’m convinced that we can persuade corporations and financial markets to take this leap. First, because the data is overwhelming: Where women are better represented in corporate leadership, businesses simply perform better[1]. Gender diverse teams deliver better results than homogeneous ones. Case closed. Full stop.

Also, there is powerful evidence that women, millennials and others want to invest in companies with gender-diverse leadership[2]. When it comes to unequal pay, or non-diverse leadership teams, or discrimination and violence against women, growing numbers of investors want their money to be part of the solution rather than part of the problem.

There is also a strong risk argument for gender lens investing (GLI). First, there is research suggesting that women sometimes approach risk differently than men and that gender diverse leadership teams can help companies lower risk[3]. But just as importantly, there is Investing 101 and the core principle that investment portfolios must be diversified — that overweighting certain asset classes or other factors (equities vs. fixed income, domestic vs. foreign stocks, developed vs. emerging markets, large cap vs. small cap, one region/sector vs. others, etc.) creates greater risk. If so, and given overwhelming evidence of the performance advantages associated with gender-diverse leadership teams, why would anyone want to overweight their investment portfolio toward men?

It’s time to put the diversity in diversification. Gender lens investing is simply smart investing.

It’s also time to recognize that gender inequality — where half the human race is subjected to systematic discrimination, oppression and violence — is the great human rights issue of our time. We are not simply talking about women being underrepresented on boards or earning roughly 20 percent less than men. We are talking about honor killings and genital mutilation and trafficking in young girls. We are talking about legal and de facto discrimination, about gender-based violence, about human rights abuses in supply chains. We are talking about our daughters, our partners, our mothers, our sisters.

Corporations and financial markets are supposed to work for them, too. It is time they did.

As engaged investors, we need to persuade the companies in our investment portfolios to say loudly and clearly: We will no longer tolerate gender inequality — on our boards, in our executive suites, in our workplaces or in our supply chains. Case closed. Full stop.

This is the task before us — for 2019 and beyond. Our industry cannot even begin to talk about investing in the transition to a more sustainable global economy unless gender equality is a core component of that transition.

Not incidentally, eradicating gender inequality could help unleash perhaps the greatest period of economic growth in the history of the planet. Research suggests that if women participated in the economy to the same degree as men, it would add $28 trillion to global gross domestic product by 2025 — equaling the combined output of the United States and China, the two largest economies in the world, every single year[4].

The smartest companies understand this. They understand that gender diversity is key to other critical business challenges: talent acquisition, workplace culture, the need for innovation. Moreover, companies with more gender diverse leadership teams are more likely to enjoy collateral or derivative benefits in connection with the same: pay equity[5], parental leave[6] and other improved benefits[7], plus lower levels of discrimination[8].

The sustainable investing/ESG industry is where gender lens investing was invented, and we at Impax Asset Management (formerly Pax World Management) have done what we can to spur that effort. Linda Pei and Leslie Christian launched the very first mutual fund in the category, the Women’s Equity Fund, in 1993, which we purchased and began offering in 2006, and which eventually became the Pax Ellevate Global Women’s Leadership Fund in 2014. Like many other sustainable investment firms, we have been voting proxies against all-male board slates for decades, and we’ve engaged in dialogues and filed shareholder resolutions with companies, calling on them to embrace gender diversity on their boards as well as pay equity among male and female employees. In 2010, I made an early attempt to make the business case for gender lens investing in a piece I wrote, “Gender Equality as an Investment Concept,” which was later published in the Huffington Post[9]. A recent piece by my colleague Julie Gorte, “The Investment Case for Gender Equality,” is among the latest thought leadership on the topic[10]. And in 2014, we launched the Pax Global Women’s Leadership Index, the first index consisting of the highest-rated companies in the world for advancing women’s leadership. Sallie Krawcheck and I, on behalf of Pax Ellevate, have also petitioned the Securities and Exchange Commission to require companies to report annually on their gender pay ratios, to help close the wage gap.

We have been in the thick of this fight, but many others have made significant contributions as well, from the Thirty Percent Coalition’s work on board diversity to the Criterion Institute’s 2015 roadmap for the future direction of GLI[11], to those who have come out with new investment strategies, the number of which has quadrupled over the past four years[12]. Veris Wealth Partners, another leader in the space, notes that during the 12-month period ending June 30, 2018, investors “poured $2.4 billion into 35 GLI vehicles holding publicly traded securities … a 23-fold increase from $100 million just four years ago.” Already there is evidence of impact: The same Veris report notes that “Gender lens investors are changing corporate priorities and how capital markets value women and girls.”

We have made progress, but the pace of change remains too slow. It’s time to accelerate.

The sustainable investing industry’s focus on climate change has led to the groundbreaking work of CERES, the Carbon Disclosure Project,, the Task Force on Climate-related Financial Disclosures (TCFD), along with a host of low carbon indices, investment vehicles and related initiatives. With government largely on the sidelines (at least in the U.S.), our industry has helped assure that climate change solutions will emerge from the private sector — from corporations and financial markets — instead.

It is time to bring the same energy and sense of urgency to gender equality that we have brought to the climate crisis. Just as we have focused on our carbon footprint, so must we focus on our gender footprint. Just as we have advanced fossil fuel free investment strategies, so should we advance discrimination-free and gender-based violence-free strategies. Just as we have made the business and economic case for solving the climate crisis, so must we make the business and economic case for ending gender inequality. All investment advisors, all asset managers, should develop strategies for integrating a gender lens into their work. If we do this, companies and capital markets will eventually respond, and change will come. Now is the time. In fact, Time’s Up.


Article by Joe Keefe, President and CEO of Pax World Funds ( and President of its investment adviser, Impax Asset Management LLC, formerly Pax World Management LLC, as well as CEO of its majority-owned subsidiary, Pax Ellevate Management LLC. An advocate for investing in women, Joe has written and spoken widely on the critical role that gender diversity plays in long-term business success. Under Joe’s leadership, Pax Ellevate Management launched the Pax Ellevate Global Women’s Leadership Fund, the first mutual fund to invest in companies that invest in women.

He co-founded the Thirty Percent Coalition and was the first chair of its institutional investor committee, whose work has led to women joining more than 100 previously non-diverse boards. He is Co-Chair of the Leadership Group for the Women’s Empowerment Principles, and in 2014 he received the Women’s Empowerment Principles Leadership Award at the United Nations. Joe is a former board chair of the Women Thrive Alliance, a global organization that worked to achieve gender equality. Financial Times named him one of its 10 “top feminist men” in 2015 for helping women succeed in business. In 2018, Barron’s named Joe one of the “20 Most Influential People in Sustainable Investing” for his work to advance gender equality.

Article Notes

[1] Joseph Keefe and Sallie Krawcheck, Impax Asset Management, “Investing in Women Is Smart Investing,” Oct. 2018.

[2] Sylvia Ann Hewlett and Andrea Turner Moffitt with Melinda Marshall, Center for Talent and Innovation, “Harnessing the Power of the Purse: Female Investors and Global Opportunities for Growth,” 2014

[3] Catalyst, “Why Diversity and Inclusion Matter,” Aug. 2018 –

[4] McKinsey & Company, “The Power of Parity: How Advancing Women’s Equality Can Add $12 Trillion to Global Growth,” Sept. 2015

[5] CNBC, “Companies with More Female Executives Make More Money—Here’s Why,” March 2018 –

[6] The Peterson Institute, “Is Gender Diversity Profitable? Evidence from a Global Survey,” Feb. 2016 –

[7] Select International, “7 Reasons To Hire Women Leaders,” 2018 –

[8] The Peterson Institute, “Is Gender Diversity Profitable? Evidence from a Global Survey,” Feb. 2016 –



[11] Criterion Institute, “The State of the Field of Gender Lens Investing,” Oct. 2015

[12] Veris Wealth Partners, “Gender Lens Investing: Bending the Arc of Finance for Women & Girls,” Oct. 2018 –

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