Does investing in companies run by women boost your returns?

Does investing in companies run by women boost your returns? Some research suggests it might. Matthew Partridge investigates.

In 2010 the then French finance minister Christine Lagarde quipped that "if Lehman Brothers had been Lehman Sisters'", the economic crisis "would look quite different". Her argument was that women have better "composure, sense of responsibility and great pragmatism in delicate situations". The idea has spread to the investment world US funds group State Street has just launched an exchange-traded fund investing in companies that rank highly on gender diversity, and two similar products are already on the market.

With only six female chief executives running FTSE 100 companies and fewer than 10% of US mutual funds run by women, there is certainly a case for more equality. However, that aside, does investing in companies run by women boost your returns? Some research suggests it might. Between 2005 and 2011, shares in US-listed firms with at least one woman on the board outperformed the market by an average of 26%, according to a study by Credit Suisse.

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Dr Matthew Partridge
Shares editor, MoneyWeek

Matthew graduated from the University of Durham in 2004; he then gained an MSc, followed by a PhD at the London School of Economics.

He has previously written for a wide range of publications, including the Guardian and the Economist, and also helped to run a newsletter on terrorism. He has spent time at Lehman Brothers, Citigroup and the consultancy Lombard Street Research.

Matthew is the author of Superinvestors: Lessons from the greatest investors in history, published by Harriman House, which has been translated into several languages. His second book, Investing Explained: The Accessible Guide to Building an Investment Portfolio, is published by Kogan Page.

As senior writer, he writes the shares and politics & economics pages, as well as weekly Blowing It and Great Frauds in History columns He also writes a fortnightly reviews page and trading tips, as well as regular cover stories and multi-page investment focus features.

Follow Matthew on Twitter: @DrMatthewPartri