UBS gender equality ETF passes $100m milestone

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The ETF passing this milestone shows investors’ appetite for putting their cash in assets which promote gender equality has never been stronger.

For example, investors have ploughed £108m (US$141m) into the UBS Global Gender Equality UCITS ETF since its launch in January this year.

The ETF was the result of a collaboration between UBS Wealth Management and UBS Asset Management and launched in response to what UBS claimed was ‘investor demands for sustainable investment opportunities that promote gender equality’.

According to UBS in 2017 investments focused on women and girls attracted US$2.2bn, compared to US$200m in 2016.

The UBS ETF, which is listed on the Swiss Exchange SIX, invests in companies in the Solactive Equileap Global Gender Equality 100 Leaders Index, this is an equity index of 100 leading global companies with a strong record in gender diversity and sustainability.

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The index lists companies that score high according to Equileap Gender Equality Ranking

This ranking is based on five criteria including gender balance in leadership and workforce; equal compensation and work/life balance; policies promoting gender equality; and commitment to women’s empowerment.

In the most recent ranking the top-scored company, in the index was L’Oreal, where women represent 46% of board members. Other companies include Westpac, which was one of the first publicly-listed companies to provide paid parental leave in 1995, and Diageo, which has directly empowered more than 300,000 women worldwide.

As at the end of August 2018, UBS Asset Management claimed to be managing the largest range of sustainable ETFs in Europe, with a total AUM of CHF 3.6 billion in UBS ETFs.

UBS, the parent company of both UBS Wealth Management and UBS Asset Management has committed itself to gender equality, it was one of the first signatories of the UK government’s Women in Finance Charter.

In January 2017 the Switzerland-based banking giant also claimed it was transforming its business to better address the needs of female clients.

See also: Insurance gender pay gap data published by CII

Suni Harford, head of investments at UBS Asset Management diversity gender equality
Suni Harford, head of investments at UBS Asset Management diversity gender equality

The ETF’s success is further proof that sustainable goals such as gender equality are a key priority for investors. At UBS, we believe we have a critical role to play in leveraging our expertise and philanthropic efforts to help the world achieve gender equality and empower women and girls all around the world.

Suni Harford, head of investments at UBS Asset Management

What is an ETF?

An ETF is an entity, with its own shares which can be traded as such. There are some tax advantages to buying ETFs, but it depends on the individual’s tax position. The assets owned by the ETF are not, however, shares themselves, the EFT invests in indexes which have been created specifically for that investor. ETFs are a passive form of investment which gives an investor exposure to a range of companies.

And what about gender lens investing?

For investors wanting to do their bit for gender equality for time-poor investors, the UBS ETF is attractive and has the financial security of a large banking institution – and the research capabilities – behind it. But investors really wanting to do their bit might be better off researching the individual companies in their existing portfolio and weeding out those not seen to be ‘doing their bit’. Not all the companies in the ETF will be appropriate to investors who want to avoid investing in companies that sell beauty products, for example. What the investor does will largely depend on their own ‘gender lens’.

See also: Women in Finance Awards 2018: winners announced