Women Leadership The first mutual fund based on women's leadership in the corporate sector has been lined up for the Indian market. The asset management outfit promoted by institutional money manager Motilal Oswal has worked out a fund to track MSCI India Women's Leadership Select 30 Total Returns Index.
Motilal Oswal, which has filed its offer document with the securities regulator, aims to replicate the performance of select companies that exhibit a commitment towards gender diversity among their boards of directors and leadership positions.
The eligibility conditions are stiff. A company, for instance, needs to have at least 3 female directors or at least a female director and a woman in leadership. The share (percentage) of female directors in the company needs to be more than all companies in the same universe. Further, there cannot be any severe structural diversity-related issues in the company.
For the record, the proposal drawn up by the asset management outfit is a first of sorts in the Indian context. The latest offer document is said to reflect the diverse nature of index products emerging in the mutual funds space. At this juncture, the number (and range) of index funds is increasing rapidly in India. A far greater number of local, ordinary investors are allocating to index funds than earlier.
As for the index itself, the MSCI India Women's Leadership Select 30 TRI, the composition presents an interesting mix of corporates. The latter include manufacturing outfits (UltraTech Cement and MRF), services firms (Wipro, Infosys, HCL Tech and Apollo Hospitals), banks (Axis and HDFC). Further, there is a clutch of smaller financial services companies -- HDFC Life Insurance and Power Finance Corporation. Moreover, the list is peppered with one-off names like Biocon, MRF and Zomato.
As for the management of the portfolio, the fund manager will undertake quarterly rebalancing. The weightage of individual components of the index is capped at 10%
The index itself has, incidentally, delivered 17.9% returns in the past 3 years. The performance since its inception in November 2019 is 18.3%
(Nilanjan Dey is Director, Wishlist Capital and author of No Room For Less. The views expressed in the column are of the writer. He can be reached on nildey@yahoo.com)
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