Investment firm Jarislowsky Fraser Ltd. has signed on to manage Canada's first mutual fund that will specialize in investing in companies that are leaders in promoting women.
The fund was created by Global Women Equity Corp. and is aimed at "socially responsible investors" who want to support companies that have made measurable commitments to supporting women, including having at least 25 per cent women directors or executive officers.
"It's a good cause for women, it's a good cause for society, but they are also good companies – they are big blue-chip companies," said Alexis Klein, chief marketing officer for Global Women Equity.
Mr. Klein said the fund's first major success was to get a firm the size of Montreal-based Jarislowsky Fraser – which has more than $30-billion in assets under management – to agree to manage the start-up fund's investments. The next step, he said, will be to sign up a major bank to carry the fund and make it available to a broad retail client base.
Global Women Equity has approached one bank about carrying the fund, but Mr. Klein said it does not have any agreement in place.
The fund will be the first of its kind in Canada, but follows on the heels of recent news of the creation of a similar fund from U.S. giant Morgan Stanley. Its "parity portfolio" will only buy shares of companies that have at least three women on their boards, and will require a minimum $250,000 (U.S.) investment.
The Global Women Equity fund, by comparison, intends to require a minimum investment of just $250, Mr. Klein said.
"It has to be accessible to all investors in Canada," he insists.
The fund will invest in companies that meet any of four criteria: they are signatories to the United Nation's Women's Empowerment Principles, they employ 25 per cent of more women directors or officers, they are members of women's advocacy group Catalyst, or they have signed the European Commission's Women on the Board pledge.
Mr. Klein said it was important to draft measurable guidelines for investments so the fund would not drift off its mandate.
He said the fund intends to invest in major Canadian and global firms such as Coca-Cola Co., BNP Paribas SA, or L'Oréal SA, which have signed on to accords or have high levels of women executives.
Mr. Klein said interested investors could include women who want to lend support to firms that are doing the best job of supporting women, or investors who have been swayed by research from organizations such as Catalyst and McKinsey & Co. showing firms with more women officers have better financial returns.
Global Women Equity has surveyed more than 4,500 financial advisers in Canada to gauge their interest in selling a women's fund, and says the response "was overwhelming."