AllianceBernstein has launched an equity fund that invests in companies with a strong track record on achieving diversity and inclusion for a “competitive advantage” in their business.
The AB Diversity Champions Equity Portfolio uses a proprietary framework to evaluate a company’s approach to diversity, equity and inclusion (DEI).
Fund managers will use AB’s six-pillar “diversity champion assessment” to pick companies to include in the portfolio.
This framework considers implementation of DEI policies and practices across the entire human capital ecosystem of a company.
The aim is to identify companies best positioned to attract and retain diverse talent that will help them succeed.
Designated an Article 9 fund, it will use the UN Sustainable Development Goals (SDGs) as a guiding lens to help identify opportunities.
It invests in global companies aligned to at least one of three SDGs focused on promoting gender equality, decent work and economic growth and reducing inequalities.
The portfolio will use the MSCI ACWI as a benchmark for performance purposes.
AllianceBernstein stated the reason for launching the fund is companies that champion diversity “are typically ahead of the curve and tend to create a virtuous circle, with highly motivated, diverse workforces driving innovation and success”.
Higher retention rates and better collaboration are among the many benefits for both the company and investors, it added.
Vivian Lubrano, joint portfolio manager AB Diversity Champions Equity Portfolio, said: “It is harder than ever for companies to stay ahead of the competition and deliver attractive returns in an uncertain and volatile market environment.
“But there is one increasingly important factor that can help them succeed: building a workforce that embraces the benefits of diversity, equity and inclusion.
“We didn’t feel that this competitive advantage has yet been properly understood or valued by the market, but we aim to bring it to the forefront.”
Gayle Baldwin, joint portfolio manager of the AB Diversity Champions Equity Portfolio, added: “We are excited to launch this fund, which is focused on the ‘S’ in ESG.”
