#Investments — 20.02.2020

Investing in human capital


‘Best employers’, education and healthy living


There is a growing awareness that companies which value their staff (the ‘human capital’) and others which contribute to education, health and entrepreneurship (microfinance) are contributing to a more sustainable and responsible world. These themes are among the UN’s Sustainable Development Goals (SDGs). We expect a growing demand for goods and services related to these areas. Companies which obtain high ratings in the areas of ‘best employers’ or ‘gender equality’ have shown a strong performance in terms of the risk-return trade-off.


We focus our attention on 3 sub-themes:

Best Employers* and gender equality

The approach for selecting companies is based on rankings such as ‘Best companies to work for’ (e.g. Fortune). Regarding gender equality, there are similar rankings (e.g. Equileap).  

Microfinance and education

Microfinance is a key driver to support sustainable growth and fight poverty. In education, we have identified opportunities in new technologies in the areas of digital education, education management as well as services and supplies.

Healthy food and food security

We see opportunities in areas such as alternative food, environmentally-friendly food production, food safety as well as healthy and natural food.

*employee satisfaction


Best Employers and gender equality

These sub-themes are part of the UN’s Sustainable Development Goals in the areas of ‘Decent work and economic growth’, ‘Gender equality’ and ‘Reduced inequalities”. Furthermore they contribute to a more sustainable and responsible world. There are also economic and financial reasons to invest in companies operating in such areas. Indeed, in a ground-breaking survey conducted by Alex Edmans in 2012¹, the author showed a link between job satisfaction and the firm’s value. In other words, he showed that the benefits of generating a high employee satisfaction outweigh the costs. Indeed, by using 28 years of data, he found that “firms with high employee satisfaction outperform their peers by 2.3 - 3.8% per year…”. Findings also suggested that “it’s employee satisfaction that causes good performance, rather than good performance allowing a firm to invest in employee satisfaction”.  The underlying factors being that high employee satisfaction allows companies to attract and keep talented workers and drives employee productivity. There are also empirical studies that show international evidence of this positive relationship: see Edmans, Li and Zhang (2014)² and Faleye and Fahan (2011)³ for example. There are numerous best employer rankings including Fortune (‘Best companies to work for’) and Glassdoor (‘Best places to work). Regarding gender equality, there are similar arguments to explain the link to company performance, i.e. attracting and keeping talented workers and improving employee productivity. Moreover, gender equality can also generate more innovative management and thinking (S. Turban, D. Wu and L. Zhang 2019)⁴.


Microfinance and education

These sub-themes are key for the Sustainable Development Goals ‘Quality education’ and ‘Reduced inequalities’.

Microfinance is a banking service that offers microloans to people with no access to financial services. The amounts are small (often a few thousand dollars or less depending on the country) and the idea is that borrowers have access to financial expertise at every stage of their project. This is a driver to support sustainable growth and gender equality and reduce inequalities.


We expect spending on education to rise sharply over the coming years due to the rise of the middle classes in emerging economies and the need for lifelong learning in a world in which Artificial Intelligence offers opportunities for workers but also creates the need for them to adapt. Innovations in educational technologies have brought new opportunities and made education more accessible to millions of people. We see opportunities in new technologies in the areas of digital education, education management at every level as well as education services and supplies.


Healthy food and food security

This theme relates to the Sustainable Development Goals ‘Zero hunger’, ‘Good health and well-being’ but also ‘Responsible consumption and production’. The UN estimates that the world’s population will rise to 9.7 billion people by 2050 (about 2 billion more than today) despite a falling fertility rate.  Making sure that the world population is fed in a sustainable and environmentally-friendly way will be one of the biggest challenges ever. This will need massive investments in alternative food and food production, technological innovation and education.  Many food production chains (especially meat) today use huge resources and are harming not only the environment but also people’s heath. Particularly harmful are artificial fertilizers, pesticides, hormones, deforestation, excessive water use but also negative externalities related to food transport over long distances. Methane emissions related to animal farms are a major contributor to human-induced emissions of CO2. These challenges suggest that there will be huge investments in these areas. We see opportunities in areas such as alternative food (plant-based), environmentally-friendly food production, food safety and healthy and natural food. The focus will also be on companies contributing to the reduction of food waste and CO2 emissions.


1. For more details see A. Edmans (2016) “28 Years of Stock Market Data shows a Link between Employee Satisfaction and Long-term Value”, Harvard Business Review, March 2016.

2. Edmans, Li and Zhang (2014), “Employee Satisfaction, Labor Market Flexibility, and Stock Returns around the World”, NBER Working Paper N° 20300, July 2014.

3. Faleye and Trahan (2011) “Labor Friendly Corporate Policies: Is What is Good for Employees Good for Shareholders?”, Journal of Business Ethics, 101, 1-27.

4. S. Turban, D. Wu and L. Zhang (2019), “When Gender Diversity Makes Firms More Productive”, Harvard Business Review.


Most investment solutions in this theme are mainly linked to equities. Despite the relevance and high potential of this theme, investment solutions will be subject to fluctuations in the global equity markets.

However, some activities related to this theme should benefit from a high Environmental, Social and Governance (ESG) rating, which may lead to lower volatility. Microfinance funds have a higher level of risk.

Graphique - Population Mondiale (en millions) - Thème 7