FTSE Russell Launches Gender Diversity Indices

Investors are increasingly taking diversity and social impact into consideration when selecting a company to invest in.

The indices will re-weight the FTSE All-Share, excluding investment trusts, and Russell 1000 companies according to the proportion of women on their boards and the firms' record on social impact measures. 

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Companies in the FTSE 350 index have a target to achieve 33% female representation on the boards of constituent companies by 2020.

FTSE Russell said there had been only "minimal" changes to the weighting of the largest companies while those that saw a large increase included Jupiter Fund Management, Royal Mail and BHP Billiton.

Mark Makepeace, chief executive of FTSE Russell, said: "The launch of FTSE Russell's new index series is another demonstration of our commitment to promote strong stewardship practices and market standards. 

"By using a factor-based methodology, we can adopt a positive approach highlighting leadership, promoting awareness and improving inclusive environments at all levels."

The indices follow a report by McKinsey & Co that found levels of gender diversity in financial services companies have improved more than in other industries.

Women made up an average of 18% of executive teams in financial services, which includes the asset management industry, compared to 13% at consumer and retail companies. 

There have been several industry initiatives run by figures such as Dame Helena Morrissey and the City Hive's Bev Shah to encourage more women into the asset management industry.

companies in the FTSE 350 Index to achieve 33% female representation on the boards of constituent companies by 2020