A tangible implication is that if the new
diversity disclosures act as a catalyst for funds to
flow into gender-based funds in the same way
that they flowed into sustainability-themed
investments after the Paris Accord,
then these funds could soon have a serious say,
not only in corporate policies but also on
share prices and a company’s ability to
raise capital. This is already
happening, but the funds tend to act
as a subsidiser of the economic returns
rather that a pursuer of better than
expected returns.
To calculate the effect of funds flowing into
diversity-themed investments, consider the
€86bn that has gone into funds focussed on
sustainability since the Paris climate conference,
a considerable amount , considering that diversity
or ‘rainbow’ does not actually have a better
returns than the existing market structure.
If we remove from that the €13bn that is likely the
result of natural growth (using the growth rate of
the prior two years as a guide) we can see €73bn
of money allocated to sustainable strategies as a
result of the “Paris effect”. This of course
is sure to lead to economic stagnation.
Already France, with its liberal policies
has failed to advance far ahead when compared with
its US or German counterparts. Diversity
will become the French economic ‘Dead Duck’
when results are compared.
EU Forecast
euf:b18:68/nws-01