BOSTON, January 14, 2021 – Natixis Investment Managers today announced that its customized indexing division, Active Index Advisors® (“AIA”), has launched Racial Equity Investment Portfolios, which seek to identify companies that promote diversity, equity and inclusion – and avoid or divest from companies that cause, contribute to, exploit or profit from racial injustice. Utilizing research and proprietary data from third-party providers, including JUST Capital and Venn Diagram Partners, AIA’s Racial Equity approach focuses on investing in companies that factor changing US demographics, and the economic power of underrepresented populations, into their respective business models.
“We believe that investors can be part of the solution to our nation’s racial inequality issues, and we are proud to provide an investment offering that could help divert funds away from fueling racial injustice, and instead focus on promoting equality,” said Curt Overway, President and Portfolio Manager, Active Index Advisors and Managed Portfolio Advisors. AIA believes that investments can directly address diversity in its portfolios, and there is credible evidence that companies that are leaders in diversity, equity and inclusion outperform their peers. For example, according to analysis from McKinsey & Company’s 2020 report, “Diversity wins: How inclusion matters1,” companies with greater diversity on their executive teams are more likely to outperform their peers in terms of profitability; conversely, McKinsey & Company found that corporations with the less diverse executive teams were more likely to underperform.
“Racial equity is tied to JUST Capital's mission of building a more inclusive economy that can be beneficial for all Americans,” said JUST Capital’s CEO, Martin Whittaker. “Through this partnership with Natixis, we look forward to engaging a wider pool of investors in our mission. Investors have a key role to play in terms of influencing social change around racial justice and equity, and in doing so, driving greater returns."
“A growing body of evidence shows companies that demonstrate diversity, equity and inclusion practices can lead to positive performance, and we are excited to partner with AIA to provide investment solutions that aim to do exactly that,” said Anthony Rust, Managing Director, Venn Diagram Partners. “There’s also an added societal benefit of investing in and steering capital towards companies who promote, incorporate and embrace DEI – and away from companies who have a history of indifference, or a business model that perpetuates racial injustice and inequities.”
The AIA Racial Equity approach applies both positive and negative screenings to include companies that aim to achieve greater employee satisfaction, reduce conflicts, and improve decision-making processes. Meanwhile, the portfolios exclude those associated with racial inequality and unequal access to health care, environmental controversies, and discriminatory lending practices. Natixis’s Multicultural and Diversity Engagement (MADE), which champions the firm’s diversity and inclusion efforts, provided valuable input in the construction of these portfolios.
“Our research has consistently shown that Americans want their investments to align with their values, and the AIA Racial Equity Portfolios empower individuals to put their money to work by supporting companies that are helping to make a difference,” said David Giunta, CEO for the US, Natixis Investment Managers. “The additional screening to AIA’s S&P 500® strategy promotes more socially conscious investment practices and enhances investors’ peace of mind.”
