Do companies that encourage gender equality have a better chance of being financially healthy and delivering greater long-term returns? The developers of a new set of indexes announced today-International Women's Day-want to show that.

Portsmouth, N.H.-based Pax World Management Corp., investment advisor to Pax World Funds (Pax World) and a leader in the field of sustainable investing, and KLD Research & Analytics Inc. (KLD), an independent investment research firm in Boston that launched the first socially responsible investment index in 1990, have joined forces to construct the first Gender Investment Index series for International Finance Corporation (IFC), a member of the World Bank Group that promotes sustainable economic growth in developing countries by supporting private sector development.

Pax World and KLD will develop five indexes that include companies that are part of the FTSE All-World Developed Index. The IFC Gender Index series' objective is to increase interest among corporations and investors in gender empowerment, with the ultimate goal of demonstrating that gender equality is an important indicator of financial health, and that companies that empower women and encourage gender diversity outperform others over the long term.

IFC provides financial products and advisory services to increase access to finance for women entrepreneurs, reduce gender barriers in the business environment, and improve the sustainability of IFC investment projects.

"We are excited to partner with Pax World and KLD to create indicators and indices that will reveal the financial value of gender empowerment practices and ultimately influence how investors think about women," said Zouera Youssoufou, the program manager of IFC's Gender Entrepreneurship Markets.  "This project is a great opportunity for IFC to further its work in creating opportunities for women in the private sector in emerging markets."

Led by Pax World's Senior Vice President for Sustainable Investing Julie Gorte, Pax World provided a research review that found that gender empowerment is usually positively related to financial performance, and can be a robust indicator of the quality of management. Pax World believes that gender empowerment is a key characteristic, along with other environmental, social and governance (ESG) criteria, of well-managed, forward-thinking companies that are capable of adding durable shareholder value over the long run.

"There are still too many in finance who doubt that gender empowerment has any effect on financial performance, and there is still a lot of skepticism about women as leaders," said Gorte.  "Research shows that gender empowerment almost always has a positive impact on performance.  Competitiveness can be achieved more readily by companies that recognize the talent of the entire workforce."

"KLD is pleased to collaborate with Pax World and IFC on this groundbreaking project to identify best practices for women in the workplace," said Karin Chamberlain, index manager for KLD.  "We look forward to creating an index that will quantify the financial impact of these practices and provide opportunities to invest in the leading companies in this area."

The index series is being constructed to provide exposure to large- and mid-cap companies that take affirmative steps to attract, retain and promote women and to advance gender equality and women's empowerment in the workplace and beyond. The series includes a benchmark, three regional indexes and a global top 100 best performers in gender empowerment. The index series is industry and region neutral.