BOSTON--(BUSINESS WIRE)--State Street Global Advisors, the asset management business of State Street Corporation (NYSE: STT), today announced recent updates to the composition of its SSGA Gender Diversity Index (The Index), which is designed to measure the performance of U.S. large capitalization companies that demonstrate greater gender diversity within senior leadership than other firms in their sector.
Following the annual rebalance on July 15, 2018, the Index now comprises a total of 171 constituents. The top ten companies held in the market capitalization weighted Index are Johnson & Johnson, Wells Fargo & Company, Home Depot, Inc., ConocoPhillips, Caterpillar Inc., Starbucks Corporation, Biogen Inc., S&P Global, Inc., MetLife, Inc. and Electronic Arts Inc.
The Index is rebalanced on an annual basis to ensure constituents continue to reflect the underlying Index objective: tracking the performance of US large-capitalization companies that are leaders within their sectors in advancing women through gender diversity on their boards of directors and in senior leadership positions. Pursuant to the rules-based Index methodology, State Street Global Advisors conducted a comprehensive review of the companies listed in the Index and added 65 new companies that have made their mark in achieving the highest levels of senior leadership gender diversity within their sectors.
“The importance of gender diversity has received an increasing amount of investors’ attention in the years that have followed the 2016 launch of the SSGA Gender Diversity Index,” said Lynn Blake, chief investment officer of Global Equity Beta Solutions at State Street Global Advisors. “However, despite evidence showing that better gender diversity leads to better performance, there remains a tremendous amount of work to do to continue moving the needle on this important issue.”
According to a 2015 MSCI1 study that explored global trends in gender diversity on corporate boards between December 2009 and August 2015, companies with at least three female board members, or companies with a higher percentage of women on the board than its country’s average, performed better as measured by return on equity (10.1 percent per year versus 7.4 percent for all other companies).2 Despite these findings, American women account for an average of just 16 percent of the members of executive teams.3
In March 2016, State Street Global Advisors introduced the SPDR® SSGA Gender Diversity Index ETF (the “Fund”) (Ticker: SHE), which is designed to track the performance of the SSGA Gender Diversity Index. The Fund is distributed by State Street Global Advisors Funds Distributors, LLC.
To help address the gender gap head-on, SHE incorporates an innovative charitable component that focuses on strengthening the next generation of women leaders - particularly in industries where women have low representation today such as STEM (Science, Technology, Engineering and Math). State Street Global Advisors is directing a portion of their revenues and a match from the firm to a Donor Advised Fund, which has awarded $25,000 grants to Black Girls Code and Iridescent’s Technovation Challenge.
“Addressing the lack of female leaders, not only in the boardroom but the pipeline as well, is an important step in bringing gender parity to corporate leadership,” said Rakhi Kumar, head of Asset Stewardship and ESG investing at State Street Global Advisors. “In supporting organizations like Black Girls Code and Iridescent’s Technovation Challenge., we hope that young women have the opportunity to succeed and continue to push the boundaries to break into traditionally male dominated fields like technology and finance.”
About State Street Global Advisors
For four decades, State Street Global Advisors has served the world’s governments, institutions and financial advisors. With a rigorous, risk-aware approach built on research, analysis and market-tested experience, we build from a breadth of active and index strategies to create cost-effective solutions. As stewards, we help portfolio companies see that what is fair for people and sustainable for the planet can deliver long-term performance. And, as pioneers in index, ETF, and ESG investing, we are always inventing new ways to invest. As a result, we have become the world’s third largest asset manager with nearly US $2.72 trillion* under our care.
*This figure is presented as of June 30, 2018 and includes approximately $53 billion of assets with respect to SPDR products for which State Street Global Advisors Funds Distributors, LLC (SSGA FD) acts solely as the marketing agent. SSGA FD and State Street Global Advisors are affiliated.
Important Risk Information:
Gender diversity risk The returns on a portfolio of securities that excludes companies that are not gender diverse may trail the returns on a portfolio of securities that includes companies that are not gender diverse.
Concentrated investments in a particular sector or industry (technology sector and electronic media companies) tend to be more volatile than the overall market and increases risk that events negatively affecting such sectors or industries could reduce returns, potentially causing the value of the Fund’s shares to decrease.
Equity securities may fluctuate in value in response to the activities of individual companies and general market and economic conditions.
Non-diversified funds that focus on a relatively small number of securities tend to be more volatile than diversified funds and the market as a whole.
Passively managed funds hold a range of securities that, in the aggregate, approximates the full Index in terms of key risk factors and other characteristics. This may cause the fund to experience tracking errors relative to performance of the index.
ETFs trade like stocks, are subject to investment risk, fluctuate in market value and may trade at prices above or below the ETFs net asset value. Brokerage commissions and ETF expenses will reduce returns.
Distributor: State Street Global Advisors Funds Distributors, LLC, member FINRA, SIPC, an indirect wholly owned subsidiary of State Street Corporation. References to State Street may include State Street Corporation and its affiliates. Certain State Street affiliates provide services and receive fees from the SPDR ETFs.
Before investing, consider the funds' investment objectives, risks, charges and expenses. To obtain a prospectus or summary prospectus which contains this and other information, call 1-866-787-2257 or visit www.spdrs.com. Read it carefully.
Not FDIC Insured • No Bank Guarantee • May Lose Value
1 The methodology used in MSCI’s study is different than that of the Index, and as such, the results of the study should not be viewed as indicative of the future performance of the Index. * This information should not be considered a recommendation to buy or sell any security shown. It is not known whether the securities shown will be profitable in the future.
2 Past performance is not a reliable indicator of future performance. It is not possible to invest directly in an index.
3 Lee, Linda-Eling , et al. Women on Boards: Global Trends in Gender Diversity on Corporate Boards, MSCI, November 2015. Accessed on February 17th, 2016 at: https://www.msci.com/documents/10199/04b6f646-d638-4878-9c61-4eb91748a82b