M&G launches fund for social diversity and inclusion
M&G launches new sustainable fund with 30 to 40 stocks focused on social diversity and inclusion
- M&G has launched a new fund focused on tackling social inequality
- Diversity and Inclusion Fund is managed by Thembeka Stemela Dagbo
- It aims to outperform the MSCI flagship global equity fund
M&G has launched a new fund that focuses on tackling social inequalities, particularly gender and ethnic diversity, while expanding its range of sustainable funds.
The M&G (Lux) Diversity and Inclusion Fund will be managed by Thembeka Stemela Dagbo and will have a portfolio of between 30 and 40 stocks.
At least 15 percent of the portfolio will be invested in social inclusion companies, leveraging M&G’s existing Positive Impact and Climate Solution approach and process.
Thembeka Stemela Dagbo will lead M&G’s new Diversity and Inclusion Fund
It will assess stocks against its ‘III’ framework, assessing each company’s investment, intent and impact.
The remainder of the fund will be allocated to sustainable companies that demonstrate gender and ethnic diversity.
All stocks in this portion of the portfolio must have a minimum of 30 percent female and/or ethnic minority board members at the time of purchase.
“If left unchecked, the exclusion of disadvantaged groups and the lack of diversity can be costly and result in lost GDP and human capital, while pioneers of diversity and inclusion initiatives are increasingly recognized for their financial outperformance.” , says Stemela Dagbo.
It aims to outperform the MSCI’s flagship global equity fund over a five-year period.
“Companies with the highest quartile level of gender diversity are 25 percent more likely to outperform, and 36 percent more likely to be ethnically diverse,” Stemela Dagbo added.
“This fund offers our clients the opportunity to capitalize on these trends and address diversity imbalances, while putting their savings to work with purpose.”
The fund, like M&G’s other sustainable funds, will follow the framework of the UN Sustainable Development Goals, focusing on quality education, gender equality, decent work and economic growth, industry, innovation and infrastructure, reduced inequality and peace, justice and strong institutions.
The asset manager is one of the leaders in sustainable investing, which has become an increasingly popular investment theme.
‘[M&G’s new fund] is exactly the kind of innovation and development we consistently demand,” said David Macdonald, founder of ethical financial consultancy The Path.
“As the market matures and consumers are listened to, a deeper and broader universe of funds can emerge that deal with more granular themes.
“Diversity and inclusion are critical goals for impact investment, which Path Financial has firmly in mind as an agenda to move forward.
‘The M&G fund is a big step in the right direction. Ultimately, we’ll want to see more of these types of funds with bolder objectives.
“But at this stage we can’t let ‘best’ get in the way of ‘better’ and it’s a very welcome step forward.”