World’s Largest Pension Throws Weight Behind Women on Corporate Boards

Japan’s Government Pension Investment Fund (GPIF), the largest pension fund in the world with $1.3 trillion in assets, moved this week to get more women on the corporate boards of portfolio companies.

The GPIF joined the U.S.’ Thirty Percent Coalition, an organization of institutional investors who use their influence to push for women on boards of public companies. CalSTRS is also a member.

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GPIF has joined the 30% Club in the UK and the Thirty Percent Coalition in the US, both of which are seeking to achieve a minimum of 30% women on boards.

The JPY135 trillion (€1.14 trillion) fund, the world’s largest, said it believed the integration of environment, social and governance (ESG) factors into investment process mitigated investment risk, and gender diversity is widely regarded as one of major social and governance factors.

Launched in 2011, the Thirty Percent Coalition is a US organisation of more than 80 members committed to the goal of women, including women of colour, holding 30% of board seats across public companies. Among its members are representatives of such institutional investors as California State Teachers’ Retirement System (CalSTRS), Ohio Public Employees Retirement System, and City of Philadelphia Board of Pensions & Retirement.

Recent research has found board diversity to be correlated with fewer governance-related controversies and higher returns:

According to a November 2015 MSCI ESG report ‘Women on Boards’, women comprise only 3.4% of directors in Japan, which was the lowest number across developed markets, and even below the level of many emerging markets.


Among the key conclusions of the research is the finding that companies in the MSCI World Index which lacked board diversity suffered more governance-related controversies than average.

It also revealed that companies with strong female leadership generated a return on equity of 10.1% per year versus 7.4% for those without, measured on an equal-weighted basis. However, the authors of the study said that in this case they could only establish correlation, not causality.

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