Corporate Gender Equality

Findings, Applications, and Opportunities

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Corporate Gender Equality: Findings, Applications, and Opportunities

Craig Churman: [mid sentence]... Maasdijk for joining us. Jane is the President and CEO of Saturna Capital so thank you, Jane, for joining us. Diana is joining us from Amsterdam, so we welcome her this evening and for those that are on the more Eastern part of the world, thank you for joining us. So, we’re glad to have this webinar. We’ve been working on this for quite a while. Diana’s group, Equileap, came to our attention through some work she does—significant work—on gender equality. Jane, who is our President and the CEO of Saturna Capital, is also the Portfolio Manager for the Sustainable Equity Fund. So, welcome Jane, welcome Diana, thanks for joining us. Jane, and we started by showing some information about the Saturna Sustainable Equity Fund, so if you want to talk a little bit about your role in the firm and the strategy you run and then we’ll go into a little more about the work that Diana’s group does with Equileap, which, you know, as we learned along the way in this database, is really powered by the research that her firm does. Welcome Jane!

Jane Carten: Thanks. Yeah, I’m Jane Carten, CEO at Saturna Capital. I’ve been here for more than twenty years and have been running the Saturna Sustainable Equity Fund for about 4 years. We use both negative and positive screenings, so we exclude certain sin-based companies in our portfolio building but we also really make a concerted effort to include companies that are doing the right thing and that we see as leaders in their space. And part of that is looking at their diversity, equity, and inclusion... not just their policies but also the makeup of their board of directors, their management, and their workforce. So, when we saw the data that As You Sow had provided through the data that they got from Equileap, we weren’t entirely surprised that we showed up as a gender equity leader, just because that’s one of the things that we intentionally look at when we choose the underlying portfolio companies. We were happy to see it and we are, of course, interested in investing in those companies partly because we want to partner with the companies that are bringing the world forward in a progressive way, but also because we believe that those companies—over time—with that long-term outlook will outperform and our shareholders will benefit in terms of performance.

Craig Churman: Yeah, and the Gender Equality Funds database is a publicly available database, and as you said, Jane, our score didn’t surprise us. It was in the 92nd percentile. And I think, within funds that are intentional in terms of sustainability, I think your fund was the 2nd. Here it’s showing... it’s 89 out of 1,100 funds across all international equity funds. I think we were pleased to see both the overall gender equality score but then that really highlighted the work that Diana’s group was doing. So, welcome Diana, if you can give us a little more background on your firm, your role in the firm, and the work that you’re doing which I think we’re all very excited about.

Diana van Maasdijk: Sure, thank you for having me here. A little bit of the background. You know, actually I’m relatively new to the financial industry. My background was always in women’s rights and gender equality. I worked for a very long time for a non-profit and then I became a philanthropy advisor and started advising high net worth individuals on how to create their foundations through their giving. And a bank, ABN AMRO, here in Amsterdam, asked me to go work for them and to set up their philanthropy services. So, I did that and that’s when I came in touch with sustainable investing, ESG investing, impact investing, whatever you want to call it. I realized that a lot of my clients weren’t only giving money, but they were investing in a sustainable way. And I came up with the idea of... Could we invest with a gender lens? If we wanted to choose the companies, could we find those companies doing best on gender equality? I called the person who was delivering the data. The sustainable data. To the bank. And found out that they didn’t have any data on gender diversity apart from the number of women on boards. And I wanted to do much more. I wanted to be able to choose companies based on whether they gave parental leave to men and women, whether they had anti-sexual harassment policies, whether they had a good balance of men and women at all levels of the company. And since that data was missing, I decided to create Equileap. So, about five years ago, I founded Equileap and today we analyze over 4,000 companies on gender.

Craig Churman: I hadn’t asked you this question before, but where did the name Equileap come in?

Diana van Maasdijk: Yeah. Well, I wanted something that didn’t include women but that included equity or equality and the whole idea is that we want to take a leap. We want to make this faster. And so, we want to close the equality gap in the workplace, that’s our mission, and we thought equity or equality and taking a leap and that’s how it became Equileap.

Craig Churman: Okay, so we now share with the group your mission, and really your added value, which is to build a database. And I think one of the elements that Saturna has in the underpinnings is... we’re an active manager and we’ve always worked on building our own proprietary screening process, because we knew we really had to understand the data across the board. So, I think our firms were mutually aligned in that aspect. Like you said, there really wasn’t good data on pay and equality other than, you know, data by board membership which is pretty high level. So, then the next topic, a little bit about Equileap, was really, where you focused on the sustainable development goal number 5, which is not only a theme in what we’ve been doing but in our most recent Impact Report, we actually highlighted the same thing. So, maybe you can give a little more background on what you’re looking at there and some of the research your firm has done, Diana.

Diana van Maasdijk: Yeah, sure. So, indeed we wanted to align ourselves with SDG 5, which is to achieve gender equality, and we also looked at things like the Women’s Empowerment Principles of the UN. Looked at all of the criteria and that’s how we came up with our gender equality scorecard, which includes 19 criteria and looks at things like what I mentioned: pay equity, gender balance, and all. And of course, we had a social mission to want to do this, but at the same time, I started looking back and seeing that there was a lot of research that pointed out that more gender diverse companies have better performance. And here in this sheet you see two of the latest research that has been done on this. I mean, there’s a lot of it. There’s mountains of research that point towards this. But some of the latest ones are in this S&P research which looked at after a CEO—a female CEO—was appointed, there was a 20% increase in the stock price. And the other one is from Glenmede, which is very interesting. They looked at the Russell 1000 from 2014 to 2020 and they ranked the companies based on the gender equality score of Equileap and found out that the top 20% of these companies outperformed the bottom 20% by 3%. So, here again, we have, you know, the business case that gender diversity isn’t only good for society but it’s good for your wallet.

Craig Churman: And Jane, you also find the same thing when you’re looking at your holdings, in terms of the diversity of the management, of the board, and of the firm. And you’ve done a lot of work at Saturna in order to advance equality within our firm.

Jane Carten: Yeah, absolutely. I think that not just in the companies we invest in but in the way that we run the firm. It’s important to live those values because, I believe, they’re really better for all of us and in doing so, we have managed to build a very gender equitable management team, workforce, and have changed our trustees on our Saturna Investment Trust to include equal women and men and I think that is helpful to the Trust, to the shareholders, and the industry. I think that very few trusts have been able to achieve that kind of equality and I’m really proud that we’re one of them.

Craig Churman: I think Jane and Diana both would say the same thing: there’s an intentionality to what we’re doing and then what companies are doing in terms of how that permeates gender equality and how it affects the overall leadership of the firm and as Diana pointed out, there is research that really affects the performance of the funds. So, Diana, your database covers—globally—over 4,000 companies in developed economies. Why don’t you tell us a little more about the research you do and the depth of the research you do at the firm level?

Diana van Maasdijk: Yeah. So, it’s all done by hand. I have a team of researchers that go out there and look at these 4,000 companies and look at their websites and their reports, corporate social responsibility reports, and gather information on these 19 criteria, which some of them are mentioned here on the sheet. We then, once a year, send an email to the companies and say, “Look, this is the information we have found on you. Is there anything you would like to add? And if you do have that, we want them to publish it.” It’s really important for us to only take publicly available information. We don’t want companies to just tick the box, but to actually say, you know, this is our gender pay gap. “We have a gender pay gap,” for example, “of 5%.” And to put it out there. And then, when the companies have published that, we get the information. Now, if they have not published it. Like, for example, in the United States only 5% of the companies publish their pay gap, the rest don’t publish. We add then that this is not disclosed. This is also important information for the investors, the asset managers, who license our data, who can then engage with companies and say, “We would like you to start publishing this,” or, “We see that you don’t give any paid parental leave to women or paid parental leave to men and we want you to do that.” So, engagement and investor activism is a lot of the things that are done with our data. Also, we see that people choose the best companies with the best scores and then that’s how they make actively managed portfolios or indices of this sort. And indeed, right now we’re just covering the developed economies which means all of North America, most of Western Europe, and parts of Asia.

Craig Churman: And Jane runs a global strategy so she’s looking into those exact same markets, some of which are fairly robust in the reporting and some of which aren’t, I guess. Jane, do you find any differences in the various markets that you’re looking at? Because I know you can limit yourself to up to 40% in any one market but that gives you 60% outside of all of those strategies, too.

Jane Carten: Sure, absolutely. Different parts of the world are on different points of the spectrum when it comes to DEI and just progressive management techniques. For example, Japan is a very forward country. We think of them as so technologically advanced but with respect to gender equity, they are not nearly where especially Europe, and the United States are. There are few women participating in the work force. They have been able to get their board numbers up to I think around 10%. Diana, I’m sure knows the exact number. But their management numbers are less, so it can be challenging to find companies in these locations that we absolutely want to participate in and what we look for are companies that are making those changes, that understand why those changes are beneficial, and then what we see is if you can find the companies just as they are waking up and realizing these advantages, you can often participate in the outperformance as it’s occurring. So, we really do like to see when we can find companies that are on the beginning of their journey toward equity and inclusion, if they’re not already there.

Craig Churman: And I think, and maybe in Diana’s case, she can actually maybe, has places where she has seen change, where the impact has come, particularly when you do year-over-year research with the companies. The next we wanted to cover was really on gender balance, globally, because I think this is an area where Saturna has had a really strong focus in terms of board diversity—for sure—and setting sort of a high bar there in terms of women in leadership. Jane, if you want to comment on when you’re looking at board and management diversity and some of the analysis we do.

Jane Carten: Sure, so when we look at a company and we view their board of directors and we talk to their investor relations people and we are examining the fundamentals of the company, we certainly look at diversity of the board. Not just actually through a gender lens but also through a racial lens, a diversity of thought lens. I like to see companies that have people from all over on their board of directors, from all over industries and where they can really bring differences of thought and potentially some friction can occur when making difficult decisions. Because really, the point is to get the company out of groupthink and allow for innovation and I think some of that friction is what makes that diversity of thought so useful.

Craig Churman: Yeah. I think maybe this is telling. It may be that this slide would be good if we had a five-year change chart, too. Of how have things changed over the years since your firm has been doing this kind of work.

Diana van Maasdijk: Yeah. This is a sad looking chart, indeed. Could be better. Needs to become better. This is why we are doing this. We have seen positive change as far as the numbers. They are going up, but it just tells you how bad they were, and we are not there yet. For sure, we see that the difference between, like Jane was saying, Japan, with the executives and the board, is just the same in almost every other country. Especially because some countries have quotas and therefore when you look at this globally and you look at the 4,000 companies globally, you wind up with a higher percentage of the board. But as you can see here, it’s not even to the 30% that so many people have been talking about for the past 20 years. So, we do see some improvement but it’s not enough and we definitely need to see more.

Craig Churman: Yeah. And then, you know this is a deeper look into Saturna’s strategy. What we show here is both the Sustainable Bond Fund and the Sustainable Equity Fund, which Jane manages. If you compare “Three or more women on the board,” the percentage is so much higher in our strategies versus the MSCI All-World Index and now, you know, I think your data, Diana, is cut across the 4,000 firms but we’re really careful to pick those firms that have made a substantial, you know, move in that direction. Either a third or more women on the board or three or more women and I think we have been very intentional and when you compare that to the board market index, it’s dramatically different. Jane, I think you in particular have done a good job of identifying of those companies which have strong leadership on a gender and, like you said, even racial diversity standpoint. So, you know, I think Jane, one of the things that you... you went to the Fund board a few years ago and were talking about gender equality as a driving factor and I think they pointed out to you that racial equality was just as important in terms of the diversity of the leadership.

Jane Carten: Yeah, I think all kinds of diversity of thought are important and can be beneficial when it comes to managing a business and making the products that are the most resonant in today’s world. I think it can only benefit people to get away from the people that might make you feel really comfortable and bring in some people that are going to stretch your thinking. I’m interested to talk to you, Diana, about what you think the greatest challenges... I mean, obviously, we have gender pay gap, which is first and foremost, but the one thing that I’ve been thinking about a lot lately that I hadn’t... I don’t think I had paid enough attention to in the past is the idea of male paternity leave. And yeah, you can offer paternity leave, but you also have to make an environment where it’s safe to take paternity leave. And if you don’t, then what’s the outcome? If you’re offering paternity leave but people aren’t taking it, men aren’t taking it, then have you done any good? Or how do you make, you know, how do you assess whether a company is making the real change and not just sort of greenwashing and saying, “We have this paternity leave available.” Do you have any insight on that? 

Diana van Maasdijk: I think you hit the nail on the head, and you were talking about Japan, right? Japan, by law, men have access to paternity leave. And they are well known for never taking it because culturally, even though the law allows this, it’s not allowed, and they were in the news a couple of months ago because a minister in their government took paternity leave and it was scandalous that he actually did. He actually said, “Well, I’m taking paternity leave.” And that’s what you need. You need to have men take paternity leave as well as you need to have women take maternity leave. But many times, women don’t take it if they are afraid their job won’t be there when they come back.

Jane Carten: Sure, well, I mean, if nobody is taking paternity leave, it makes it pretty hard. It makes it even more difficult to take maternity leave.

Diana van Maasdijk: And the numbers show up in the percentage of numbers of the senior management and the executives. I think that’s where we really have to keep our eye out for those numbers, to see if those are changing. But indeed, a company could say, “We don’t allow sexual harassment,” and then there’s a toxic work environment. So, it’s really important to see... it’s not enough to have the policies, I agree. But we have to start seeing the numbers show that. And I think one of the most important things that we have to see, for sure, is men taking paternity leave.

Jane Carten: Have you seen anything in your studies that makes that easier? That makes it more likely that they’re going to do that? So that it’s not... I just worry that you offer it, they don’t take it, it’s a macho peer pressure thing where they’re not taking it.

Diana van Maasdijk: What I have seen that I’ve heard works is in the Scandinavian model. When the men have access to it, that it’s the couple... whether it’s a heterosexual couple or a homosexual couple, the couple has access to so much leave and if the one partner doesn’t take it, the other one can’t have it either. And so, in that instance, you have to take it in order to really have the leave for both. And maybe that’s one of the ways that might work.

Jane Carten: Okay, thanks.

Craig Churman: I think that’s one of the items where our firm has grown. We now have almost a different group of employees and I mean, Jane has been pushing hard to encourage this type of activity in both the benefits but making sure that it’s part of the culture. No different. And you just mentioned the Nordic countries, or Sweden, your group, Diana, does a really nice job on a country-by-country basis of really looking into things and then, you know, one of the reasons we like this slide is the US and Japan on the bottom right are just so far behind in terms of publishing gender pay gap information. And I’m surprised being in the industry for almost 40 years that this is still something that we’re talking about. I mean that there’s pay gaps and in terms of sharing that information. It actually surprises me. Jane, have you...

Jane Carten: I don’t think it would surprise many women, to be honest. I think that sort of shows the difference, that you’re surprised by it. Maybe that’s unfair, but I’m not surprised that it’s still a thing. We have a long way to go and there are so many reasons why the pay gap exists and so many barriers to really, truly, opening it up and putting it under the sunshine and saying, “Here’s what we need to do in order to make this change,” and yeah, it’s so many reasons, from just the way that women advocate for themselves in the workplace to old, sort of engrained thoughts that we have. Implicit bias, essentially, that we have about helping men be the economic caretakers of their families, etc. So, yeah, there’s a long way for us to go with pay.

Craig Churman: And some of the countries have done, I guess, work in terms of regulating and requiring it. With Spain and the UK being way ahead of some of the other governments of some of the other countries.

Diana van Maasdijk: Yeah, I mean, despite the increasing participation in the workforce, women only earn 77% of what men earn, globally. That’s our global number. This is why I always say ESG investing must incorporate a gender lens. In order to truly include and strengthen the social issues, next to the environmental and governance issues. And this sheet here shows you which countries... how many companies, what percentage of the companies, are publishing their gender pay information. And here you see that it’s not the Nordics, Sweden is only 9%. It’s not the North Americans. It’s actually Spain, quite high. Italy and the UK are the highest ones. And it’s because they have legislation. And these countries all have legislation saying companies must calculate their pay gap that they have between the average pay they give to women in the company and the average pay to men. The UK says not only do you have to calculate it, you have to publish it. But all of these countries that you see higher numbers, even in Australia, even though it’s not that high, 20%. They do have a report, Australian companies have to report to their governments, telling them if they are calculating the pay gap or not. And here you see the difference, then, with those countries that have legislation and those who won’t. And I think, in the end, we’ve had a problem with the pay gap for a very, very long time like Jane says. And the only way we are going to change it is if there’s legislation that forces companies to be transparent about it.

Craig Churman: Diana, we have a question in the chat that was directed to you. MSCI just released several gender data points including workforce breakdown by gender, D&I targets linked to executive pay, etc. How is your data different from MSCI in terms of its gender data? Do you have any idea there?

Diana van Maasdijk: I’d have to look at it. They just released exactly what they are. I know that they had pay data on the board. I would have to see exactly what they’re doing on their data on the board but on their pay data, for example, I know that we’re the only ones who look at the median pay gap, the mean pay gap, in three bands, and a strategy to change. So, we are very much focused only on gender equality and we focus on 27 metrics across the 19 criteria. Anybody who wants to look at that can email me, and we can share, what is it? A sample.

Craig Churman: I’ll move on to the next slide because we, yeah, there are a number of resources that we mentioned, and we will make sure that all of those are available to everybody. We will be able to send you copies of the slides and I think, you know, Diana’s website has a lot of nice reports in terms of gender equality. So, I think there’s a lot of good information there, too. Saturna has published our Impact Report for a while. There’s some nice information, particularly as we talk about those companies that have been strong in terms of SDG number 5. I think we used the case study of AXA in that report also. So, we can share that. You know, we have our Impact Report. There’s also an article that Jane, and maybe you want to talk a little bit about this, where you put the article back in March where you said, “We really need to start earlier with grooming women to become CEOs in the financial world.” And I know you have some thoughts there.

Jane Carten: Yeah, I absolutely think the pipeline is an important place to start and that it is unfortunate that finance is still sort of a male-dominated field. I think it’s such a fantastic place to be career-wise. We’re so lucky to have important work that’s interesting and I would wish that for everyone’s daughter and, you know, sister. And I think that if we can encourage women in a way that shows them from a young age that their voices are really important when it comes to financial decisions, we’re going to be better off. And I do think that is starting and that’s happening more than it has in the future, but I think we have a long way to go.

Craig Churman: Yeah, and you know, I think you’re doing some work, Jane, with the ICI and some other groups to really be a leader in terms of pushing that. And you’ve also done work in terms of adding to the PM staff at our own firm in terms of it. Our percentages our higher than the industry as a whole in terms of women managing and women in leadership and managing funds.

Jane Carten: Yeah, but we still, I mean, have some wonderful female leaders in our executive team and on our board and in our portfolio management, but we could always use more, and I will say that when we have positions available, we get many fewer female applicants than male. Just on a percentage basis. And we get many fewer people of color than we get white people. You know. It’s an interesting problem to try and sort out and I think that by the time that people are ready to apply for jobs, it’s a little too late. We need to go back to the education level and say, “Hey these are wonderful careers and please consider them.”

Craig Churman: Yeah, and I was going to ask you, Diana, are you seeing some of the work that you’re doing leading to career development at the firms that you’re talking to? I think you’re doing a nice job of carrying that message upstream within the companies. Have you seen an impact in terms of career development? 

Diana van Maasdijk: What we have seen is about 8 to 10% of the companies we contact actually want to engage with us. And they’re asking us, you know, “What are you looking at? How can I increase my score?” and we have good conversations with them. Where I think that the conversations we have with them on exactly, you know, we’re looking for a percentage of the workforce to be between 40 and 60% in order to give them the highest numbers. You know, we are looking for them to give parental leave to both men and women, that they have come back and said, “Oh, okay, we’re going to take this into consideration.” If they are actually doing it, I think it’s too young. We’re too young of a company to see that. What I do see is that companies do care. Many companies do care, and they are trying to improve.

Craig Churman: We found each other through the’s database, which is put out by As You Sow, a west coast-based firm. How did you start your relationship with As You Sow, and how did that develop?

Diana van Maasdijk: That’s a really good question. Andy Behar is the CEO there. Oh, I know, I know how it happened. So, we were licensing and selling our data in the United States. We’re actually in Amsterdam, like you said, and we were working the US market and came into contact with someone who has a foundation called Ruth Shaber, and she said, “You need to talk to As You Sow, because As You Sow does this sort of activism around different websites.” And that’s how we came into contact with them. And they told us about their dream of wanting to create a website where they could show the gender diversity and gender equality of all ETFs and mutual funds. And that they needed the data. So that’s how we started licensing the data to them. Usually, we only license to asset managers. This is the first NGO that licensed from us.

Craig Churman: Right. And we were introduced through a consulting firm on the west coast that, you know, called us and said, “Your Fund, Jane’s Fund, ranks very highly in terms of gender equality.” We said, “Thank you very much, what’s your source?” And we were able to go back and look through that database and really understand it and we were pleasantly surprised it was such a high ranking while we really like the underpinnings of the quality data. So, we really appreciate that. We still have that resource listed on there. The database, which is really a powerful tool. We just showed the one screen. But it actually is a nice tool for researching that. And the advisors can use it to, you know, showcase funds that they want to buy.

Diana van Maasdijk: Yeah. You can look at any mutual fund. Any ETF in the United States. It’s on there.

Craig Churman: So, I included in there Diana’s contact information. I think everybody on the call knows the folks at Saturna. We will send copies of the slides to everybody. To Jane and Diana, any other closing comments to you want to add before we wrap it up today? 

Jane Carten: Just thanks for being here and Diana, it was fantastic to be able to spend some time together and I hope you have a nice night in Amsterdam.

Diana van Maasdijk: Listen, I’m ready for a glass of wine. It’s been a pleasure. Thank you so much, and I look forward to doing more together and anybody who wants to contact us, you know, happy to connect. We also are quite active on LinkedIn. So, see anybody who’s interested.

Craig Churman: Okay. And all of the resources that we list are available and if anybody needs anything just let us know and then copies of the slides will be sent out right away. Thank you, everyone, for joining our sustainable webinar. Thank you to Jane. Thank you to Diana. It’s been a pleasure spending time with you, and we really appreciate the efforts that both of you do in terms of the way you manage your firms and the business and really take care of clients’ investments. Thank you very much.

Jane Carten: Thank you, Craig for putting it together.

Diana van Maasdijk: Thank you, Craig! Thank you, Jane. Bye.

Narrator [Disclosure]: Please consider an investment's objectives, risks, charges, and expenses carefully before investing. To obtain this and other important information about the Saturna Sustainable Funds in a current prospectus or summary prospectus, please visit or call toll free 1-800-728-8762. Please read the prospectus or summary prospectus carefully before investing. 

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