Strategies that aim at gender are growing inpopularity as managers appeal to more socially conscious investors.(Photo: Shutterstock)

(Bloomberg) –Fidelity Investments has started a mutual fund thatinvests in companies with a high percentage ofwomen in leadership positions.

The actively managed Women's Leadership Fund was launched onWednesday, according to a statement from Boston-based Fidelity,which is led by Abby Johnson. The fund will invest in about 100companies that have either one-third women board members, a womanon the senior management team or that meet gender diversityinitiatives for hiring, retention, paid leave and promotion ofwomen.

“I'm looking for companies that I believe are committed tofemale leadership and development, that can grow earnings more thanthe market and that have resilient businesses models,” said NicoleConnolly, Fidelity's head of ESG investing and the fund's portfoliomanager.

Strategies that focus on gender are growing in popularity asmanagers appeal to more socially conscious investors. The Fidelityfund sets a high bar for such funds, which typically require that acompany have from one to three women on their board to qualify forthe strategy.

Connolly said she hopes her fund will be an incentive forcompanies to promote and hire more women and will back proposals atcompanies that push for gender targets. She said the averagepercentage of women on boards in the Russell 3000 index is about 17percent.

The Women's Leadership Fund, which can allocate across allsectors, is looking at about 700 companies in the Russell 3000index as potential investments and expects that universeto keep growing. It has no investment minimums.

There are about 40 gender-focused investment funds, according todata tracked by Bloomberg, and more than half of them were launchedsince 2017.

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