Supporting companies promoting gender-inclusion through a structured product
A new initiative to develop Socially Responsible
In recent years, Socially Responsible Investment (SRI) and Corporate Social Responsibility (CSR) have been at the heart of corporate strategy and have been developing strongly. Diversity and inclusion policies are part of the CSR approach and are part of the social and governance analysis of companies. Taking into account these governance and diversity criteria has a real potential for economic performance and social progress.
This conviction is illustrated within Societe Generale Private Banking by our ability to offer exposure to the Euronext® Eurozone Diversity & Governance 40 EW Decrement 5% index in our structured product program. This index promotes through its composition companies that respect strict environmental and social criteria, while paying particular attention to their governance.
How is the index constructed?
The starting universe of the Euronext® Eurozone Diversity & Governance 40 EW Decrement 5% index includes the 80 largest European market capitalisations in the Euronext® Eurozone 300 index.
The responsible component of the index intervenes through the selection filters that are applied to it:
▪ Exclusion of the worst E (Environment) or S (Social) scores comprising the last decile of the starting universe.
▪ Exclusion of companies in the tobacco, controversial weapons and highly controversial activities sectors.
▪ Exclusion of companies where no women serve on the board of directors.
Ultimately, the top 40 companies in the index are selected on the basis of a governance and diversity score, calculated according to the methodology developed by LeaderXXchange, a strategic governance and ESG integration consulting organization for companies.
What is the impact of investing in this index ?
Gender parity is also an economic issue. According to the "Women Matter"(1) study conducted by McKinsey & Company, companies with a gender-balanced executive committee have revenues that are 55% higher on average than their competitors. In other words, a company that diversifies its recruitment mechanically increases its talent pool and, in turn, its performance. More broadly, according to the Organisation for Economic Co-operation and Development (OECD)(2), if the gender gap in the world of work were to close, there would be a 12% increase in global gross domestic product (GDP).
The theme of governance and diversity is an investment opportunity that deserves attention. By moving the corporate world towards greater equality and opportunity for all, we are helping to create a positive impact and a sustainable future.
Would you like to discuss this subject further with us?
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