In 2016, State Street Global Advisors made a splash when it introduced an exchange-traded fund aimed at fostering gender diversity in the workplace.

Seeded with $250 million by the California State Teachers’ Retirement System (CalSTRS), it was one of the largest exchange-traded fund launches at the time and helped bring the environmental, social and governance theme to greater prominence in the ETF industry.

The SPDR SSGA Gender Diversity Index ETF (SHE) was designed to invest in companies with a high proportion of women in senior leadership roles. Its constituent companies had to have at least one woman on their boards or in CEO roles. Nearly 80% of the fund’s portfolio is U.S. large-cap stocks.

The fund had officially attained a three-year track record as of March 7, which made it a good time to ask how well SHE has done both as an investment and as an ETF with a mission.

The results are mixed. The fund was up 11% year to date as of mid-March, with a one-year gain of 4.7%. SHE’s three-year annualized return was 12.1%. By comparison, the SPDR S&P 500 Trust ETF (SPY) was up 12.6% year to date. SPY’s one-year return was 3.6%, and its three-year gain was 13.8%. From a purely mercenary standpoint, investors would’ve done better with SPY during the past three years, especially considering that its expense ratio of 9 basis points is 11 basis points cheaper than SHE’s.

But that’s not entirely the point when it comes to investing in a gender-diversity fund. “We’ve been very pleased with the reception that it has received in the marketplace with the ability to highlight stewardship in a very meaningful way,” says Sue Thompson, president of SPDR Americas distribution at State Street Global Advisors.

Thompson says SHE has helped to encourage a dialogue about ESG investing, and that State Street is having more conversations with financial advisors on this theme. Furthermore, she adds, State Street in the past three years has reached out to more than 1,200 companies that did not have any women on their boards, and now more than 400 of those boards have one.


SHE was the only gender-diversity-focused ETF until the Impact Shares YWCA Women’s Empowerment ETF (WOMN) debuted last August. Impact Shares, the fund’s sponsor, works with the YWCA in selecting which companies belong in the index. They use 19 criteria to determine a gender equity score including gender balance in leadership, equal pay and work/life balance, and policies promoting gender equality.

ESG investing is still relatively new in the ETF world, and many funds under this umbrella don’t have long track records. Ethan Powell, CEO of Impact Shares, says ESG investing needs to start evolving from simply outcome-oriented metrics to commitments that empower people. “[We need] to get more creative and find the sort of data and data analytics that show which traits are most highly correlated with having a natural outcome of women and people of color in leadership positions,” he says.

First « 1 2 3 » Next