Academic studies suggest and, more importantly, real-time performance, suggest that companies that are more diverse at the board level deliver superior long-term returns relative to their less diverse counterparts.

It seems some are heeding that advice and improving board-level gender diversification. For investors, that theme is accessible via the  SPDR SSGA Gender Diversity Index ETF (SHE). SHE, which turns six years old in early March, follows the SSGA Gender Diversity Index.

SHE’s underlying index focuses on companies that are gender-diverse in senior leadership roles. That’s a relevant methodology at a time when more companies are prioritizing related initiatives.

“The share of corporate board seats held by women at Moody’s-rated North American and European companies has risen by about five percentage points in aggregate during the past two years, with increases evident across most rating categories,” says Moody’s Investors Service.

The $253.58 million SHE is home to 191 stocks, confirming not only that there’s a high bar to entry into this exchange traded fund but that many U.S. companies have work to do in terms of adding more women to high-level roles in their organizations. There are good reasons why companies should continue pursuing more gender diversity.

“Our analysis shows that higher-rated companies continue to have a higher proportion of women on their boards. Although the data falls short of demonstrating direct causation, we consider the presence of women on boards – and the potential diversity of opinion they bring – as being supportive of good corporate governance, which is positive for credit quality,” adds Moody’s.

It’s not just board seats that matter. C-suite executive roles, a theme SHE taps into, are material in this conversation, and that’s an area where many S&P 500 member firms can improve gender diversity.

“As we found in our previous analyses of board-level gender diversity, the data suggests that higher ratings are not only correlated with a higher proportion of women on boards but also with a higher percentage of women in C-suite executive positions,” notes Moody’s.

Translation: Companies with more women in the C-suite and/or on the board of directors can have higher credit ratings, and higher credit ratings mean lower financing costs. Additionally, companies with above-average levels of gender diversification score on governance issues – the “G” in ESG.

For more news, information, and strategy, visit the ESG Channel.

The opinions and forecasts expressed herein are solely those of Tom Lydon, and may not actually come to pass. Information on this site should not be used or construed as an offer to sell, a solicitation of an offer to buy, or a recommendation for any product.