OPINION: Last Thursday was International Men’s Day, which is a time to reflect on the wellness and contribution of men to our world. What does gender have to do with investing? Everything.
Lots of signs point to the ways that gender shapes our investment decisions. Analysis of trading data has shown men buy and sell shares much more often than women and are prepared to take on more risk. Acting on impulse and being prepared to “roll the dice” does not make for successful investing.
In recent research by the Responsible Investment Association of Australasia, 1,000 New Zealanders were asked whether they expected their KiwiSaver fund to invest responsibly and ethically. Women were far more likely to expect ethical investments than men.
When asked if they believed that ethical (or responsible) KiwiSaver funds and other investments would perform better in the long term, way more women than men said yes.
What about a desire to avoid investment in environmental degradation, animal testing, factory farming, weapons or fossil fuels? Again, way more women than men cared.
There was one area that men score more highly than women. But that was agreeing to the statement: “I don’t think ethical investing makes a difference.” So, men don’t care about ethical investing as much as women. So what?
It really matters, particularly when there’s plenty of research showing that accounting for environmental, social and governance metrics, as well as financial metrics, improves investment returns and reduces investment risk. Just ask the prestigious consulting firm McKinsey, or the NZ Super Fund, or investment managers globally. Why are we men not reading the research or accepting the message?
How we invest our dollar of savings is as important for the environment as how we choose to spend our consumer dollar. Aside from the returns argument, men are slower than women to draw the connection between how we invest and real-world consequences.
This matters. As men, we are much more likely than women to be entrepreneurs or chief executives or on the board of a listed company. The fact we have fewer women in these roles likely means that there are fewer voices considering environmental and social issues in key corporate decisions than if women had more say. To balance this we need more women entrepreneurs, chief executives and directors.
Men have much higher average KiwiSaver balances and more savings generally, so their investment decisions produce a greater impact.
I care about the mental and physical health of men. I also care about the health of our nation’s savings and the health of our planet.
Frankly, future generations will thank us men if we show more care for environmental and social issues across our investment and financial decisions. And the evidence says we will build more robust companies and make higher financial returns if we do this.
Or we could just hand over more decision-making to women in Aotearoa who seem to “get it” more than us.
To be clear I’m not saying to guys it is time to stand up or step aside. But I am saying we need to redefine what it means to “man up” – man up should simply mean to “lift our mahi”.
John Berry is co-founder and chief executive at ethical investment manager Pathfinder Asset Management, and ethical KiwiSaver provider CareSaver. He is also on the Board of the Men’s Health Trust. ‘Mahi’ means to work, do, perform, make, accomplish or practice.