SAN DIEGO -- Women hold only a fraction of roles in corporate leadership. Your clients probably notice.
One way to effect positive change is by helping clients engage in responsible investing through a gender lens, Suzanne Mestayer, managing principal at ThirtyNorth Investments told an audience during her presentation on women executives at the IMCA annual conference in San Diego.
"Why should gender lens investing be important to advisers?" Mestayer asked the audience. "It should be important to you because investors are genuinely interested in this topic."
She says many investors learn they can effect change this way through unexpected sources.
"People are learning from what they're reading, their friends and family ― they're not hearing about it from their financial advisers."
Mathieu Beauchesne is Head of Life and Health Insurance at GFT Canada, where he works with leading insurance carriers to transform their operating models into new digital and AI-powered architectures. He has more than a decade of experience in IT consulting in the insurance space, specializing in business architecture, IT strategy development and business analytics.
Sales were mostly flat until 2020. Over the past four years though, they've nearly doubled.
Mestayer, whose RIA has offices in New Orleans and Baton Rouge, Louisiana, says it's time to move away from the assumption that making decisions based on the desire to do good deeds isn't necessarily financially viable.
"We just assume ourselves that it's not financially the best investment," she says.
"It may be great for social causes but financially? Is that the best thing I can do for my client?"
YOU'VE COME A LONG WAY, BABY
After she realized she didn't know what she wanted her major to be in college, then-high school senior Mestayer took an aptitude test at her local university. The results? She would make a great math and science teacher ... or an accountant.
Mestayer's father — who had always been supportive of her endeavors — opined on the results earnestly: "I just don't think that becoming an accountant is a career where a young woman can be successful these days," Mestayer recalled him saying.
"In the fall I went and registered in LSU and promptly declared a major in accounting," Mestayer said. A 20-year career at an international accounting firm followed. Today, over 63% of the accounting profession is made up of women, Mestayer says.
Mestayer's personal story emphasizes the possibility for positive change. She remembers the 1968 Virginia Slims slogan targeted at young female professionals: "You've come a long way, baby."
"I remember thinking, wow. Women really have come a long way," Mestayer says.
Yet there is still more progress to be made. Only 13.8% of corporate leadership positions are held by women globally, according to Credit Suisse data cited by Mestayer. It's marginally better in the United States, where 16% of executive roles are occupied by women.
And though a longstanding problem, more attention has been paid to gender inequality within the financial services industry due to asset manager State Street's
In addition to client interest, focusing on a gender lens can help advisers carve out a unique diversifier for their businesses, Mestayer says.
"For those of us in wealth management, we all know best practices are to stop talking about investment performance and more about goals and objectives," said Mestayer. "This topic goes beautifully into that discussion and gives you an opportunity to learn more about what matters to your clients."
HOW CAN GENDER LENS INVESTING HELP?
Returns on hypothetical portfolios based on gender representation on corporate boards are markedly higher when there is at least one woman on the board, according to data compiled by ThirtyNorth. The returns get even higher over time when there is 25% female representation.
The idea that financial rewards should take a backseat to progress towards gender equality is increasingly refuted by a growing body of research, Mestayer says.
She suggests bringing up these issues with clients as a natural topic of conversation. Mestayer recalls doing so with her clients during an annual review.
"I started to explain the concept that women in corporate leadership could have a positive effect — not just for women and girls but also investments — and could enhance profitability and all characteristics of corporate performance," she said.
The clients' curiosity was sparked, she says — but not exactly where she expected it.
"The husband immediately gravitated to this. He said, 'Now this is something I want to hear about.' I was really actually quite surprised," she says.
"If you think I'm making much ado about one anecdote, I will tell you every single person we talk to about this is extremely interested."
