Introducing Introducing Introducing

Introducing the Women in Leadership theme basket

Equities 5 minutes to read
PG
Peter Garnry

Head of Equity Strategy

Summary:  ESG is high on the agenda among companies and investors. Often the focus is only on the E as the environment is a key concern for policy markers due to climate change, but our new equity theme basket is focusing instead on the S (social) through women leadership. We have created a basket consisting of 30 companies with high percentage of women in their leadership team representing $1.1trn in market value. Recent research suggests that companies with a higher degree of gender equality in their leadership team perform better both on fundamentals and in the equity market..


Why women leadership?

Today we are launching our next equity theme basket focusing on women leadership. Why would do we need a women leadership basket? We are currently running an investor theme focus on ESG and the percentage of woman in companies’ executive team is part of the social aspect of companies. Recent research (here and here) also shows that there are mostly positive impact on company performance from having a more gender diversified executive team. This research from S&P Global also show that publicly listed companies with more women in the leadership team performs better.

The histogram below shows the distribution of women in percent of leadership teams among 2,600 companies with a market value above $5bn across North America, Europe, and Asia. The median percentage of women executives is as low as 14.3% with very few companies having gender equality. This figure is arguably very low and shows the big change that will undoubtedly unfold over the coming decades. However, in the meantime there are several companies that already have gender equality in their leadership team and these form the basis of our women leadership basket.

Source: Bloomberg and Saxo Group

Women leadership basket

The basket consists of 30 companies with 10 companies each from North America, Europe, and Asia Pacific (developed countries). Companies with a market value below $5bn have been excluded from the list. The average percentage of women in executive leadership across the three geographical areas is 63.2% (North America), 52.9% (Europe), and 59.7% (Asia Pacific).

The 30 companies represent $1.1trn in market value with JPMorgan Chase being the largest company in the basket. There are few surprising names on the list such as the mining giant BHP Group and oil & gas exploration company Woodside Petroleum. The median revenue growth across these 30 companies is 12.8% which is above the market average and the median ROIC/ROE is 13.6% which is slightly above the global average. So overall, good quality basket. Sell-side analysts have on average a price target that is 20% above the current price and the median 5-year total return has been 138% which is better than the MSCI World Index.

NameMkt Cap (USD mn.)Sales growth (%)ROIC (%)Diff to PT (%)5yr return
JPMorgan Chase & Co429,430-2.018.319.291.6
BHP Group PLC165,02441.733.7-4.9141.7
Investor AB65,187201.339.910.8151.5
Block Inc48,729118.84.2128.2627.0
Lululemon Athletica Inc39,63143.936.542.4358.7
Hang Seng Bank Ltd38,244-15.09.711.520.3
DNB Bank ASA35,632-17.010.23.887.4
Koninklijke DSM NV31,73613.87.020.2199.4
Wolters Kluwer NV25,797-2.416.78.3178.6
CDW Corp/DE24,66512.126.718.6273.4
ViacomCBS Inc20,4599.512.350.8-46.1
Etsy Inc17,69161.720.674.3979.2
Woodside Petroleum Ltd16,862-7.13.516.14.3
Next PLC13,41721.727.215.6133.2
REA Group Ltd13,13413.131.118.0188.0
Xero Ltd11,46119.71.327.8499.3
Booz Allen Hamilton Holding Corp10,9852.418.120.3145.9
FinecoBank Banca Fineco SpA9,8696.020.519.2189.8
CapitaLand Integrated Commercial Trust9,44476.34.125.628.3
Ascendas Real Estate Investment Trust8,65912.54.922.751.1
Jazz Pharmaceuticals PLC8,30125.63.647.113.0
Tenet Healthcare Corp7,83911.516.226.7300.1
Castellum AB7,833-0.23.518.8114.1
Bright Horizons Family Solutions Inc7,1440.74.933.968.3
GDS Holdings Ltd6,82737.41.3115.1361.2
Stockland6,535-2.05.320.219.6
ASR Nederland NV6,42538.614.89.0111.0
Orion Oyj5,623-7.026.45.40.7
Crocs Inc5,51972.862.4121.01,198.9
Minth Group Ltd5,11919.810.334.354.2
Aggregate / median1,103,22312.813.620.2137.5
Source: Bloomberg and Saxo Group
* ROIC is used for non-financial companies and ROE is used for financial companies

As the performance below shows our Women in Leadership basket has delivered 250% total return compared to 101% for the MSCI World Index since inception in December 2015, but this obviously reflect a combination of surviourship and selection bias as thus historical performance is not an indicator of future performance. 

Disclaimer

Saxo Capital Markets (Australia) Limited prepares and distributes information/research produced within the Saxo Bank Group for informational purposes only. In addition to the disclaimer below, if any general advice is provided, such advice does not take into account your individual objectives, financial situation or needs. You should consider the appropriateness of trading any financial instrument as trading can result in losses that exceed your initial investment. Please refer to our Analysis Disclaimer, and our Financial Services Guide and Product Disclosure Statement. All legal documentation and disclaimers can be found at https://www.home.saxo/en-au/legal/.

The Saxo Bank Group entities each provide execution-only service. Access and use of Saxo News & Research and any Saxo Bank Group website are subject to (i) the Terms of Use; (ii) the full Disclaimer; and (iii) the Risk Warning in addition (where relevant) to the terms governing the use of the website of a member of the Saxo Bank Group.

Saxo News & Research is provided for informational purposes, does not contain (and should not be construed as containing) financial, investment, tax or trading advice or advice of any sort offered, recommended or endorsed by Saxo Bank Group and should not be construed as a record of our trading prices, or as an offer, incentive or solicitation for the subscription, sale or purchase in any financial instrument. No representation or warranty is given as to the accuracy or completeness of this information. All trading or investments you make must be pursuant to your own unprompted and informed self-directed decision. No Saxo Bank Group entity shall be liable for any losses that you may sustain as a result of any investment decision made in reliance on information on Saxo News & Research.

To the extent that any content is construed as investment research, such content was not intended to and has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such, would be considered as a marketing communication.

None of the information contained here constitutes an offer to purchase or sell a financial instrument, or to make any investments.Saxo Capital Markets does not take into account your personal investment objectives or financial situation and makes no representation and assumes no liability as to the accuracy or completeness of the information nor for any loss arising from any investment made in reliance of this presentation. Any opinions made are subject to change and may be personal to the author. These may not necessarily reflect the opinion of Saxo Capital Markets or its affiliates.

Please read our disclaimers:
- Full Disclaimer (https://www.home.saxo/en-au/legal/disclaimer/saxo-disclaimer)
- Analysis Disclaimer (https://www.home.saxo/en-au/legal/analysis-disclaimer/saxo-analysis-disclaimer)
- Notification on Non-Independent Investment Research (https://www.home.saxo/legal/niird/notification)

Saxo Capital Markets (Australia) Limited
Suite 1, Level 14, 9 Castlereagh St
Sydney NSW 2000
Australia

Contact Saxo

Select region

Australia
Australia

The Saxo trading platform has received numerous awards and recognition. For details of these awards and information on awards visit www.home.saxo/en-au/about-us/awards

Saxo Capital Markets (Australia) Limited ABN 32 110 128 286 AFSL 280372 (‘Saxo’ or ‘Saxo Capital Markets’) is a wholly owned subsidiary of Saxo Bank A/S, headquartered in Denmark. Please refer to our General Business Terms, Financial Services Guide, Product Disclosure Statement and Target Market Determination to consider whether acquiring or continuing to hold financial products is suitable for you, prior to opening an account and investing in a financial product.

Trading in financial instruments carries various risks, and is not suitable for all investors. Please seek expert advice, and always ensure that you fully understand these risks before trading. Saxo Capital Markets does not provide ‘personal’ financial product advice, any information available on this website is ‘general’ in nature and for informational purposes only. Saxo Capital Markets does not take into account an individual’s needs, objectives or financial situation. The Target Market Determination should assist you in determining whether any of the products or services we offer are likely to be consistent with your objectives, financial situation and needs.

Apple, iPad and iPhone are trademarks of Apple Inc., registered in the US and other countries. AppStore is a service mark of Apple Inc.

The information or the products and services referred to on this website may be accessed worldwide, however is only intended for distribution to and use by recipients located in countries where such use does not constitute a violation of applicable legislation or regulations. Products and Services offered on this website is not intended for residents of the United States and Japan.

Please click here to view our full disclaimer.