Bank of America Merrill Lynch, March 7, 2018
Bank of America Merrill Lynch analyzed ESG sub-pillar data related to gender diversity, including board diversity, women in management, and company policies on diversity/inclusion. They found that companies with high scores on these metrics generally saw lower subsequent price and EPS volatility and higher subsequent ROEs than those with low scores.
EPS – Earnings per share (EPS) is the portion of a company’s profit allocated to each outstanding share of common stock. Earnings per share serves as an indicator of a company’s profitability.
ROE – Return on Equity (ROE) is the amount of net income returned as a percentage of shareholders equity. Return on equity measures a corporation’s profitability by revealing how much profit a company generates with the money shareholders have invested.
CAGR – The compound annual growth rate (CAGR) is the mean annual growth rate of an investment over a specified period of time longer than one year.