Women run 401(k)s better than men: Morningstar

401(k)s are better off in the hands of women, according to a report Tuesday from Morningstar.

The report, coinciding with Women’s History Month, found that plans administered by women were more likely than those overseen by men to have designs that encourage participation and diversification. Such plans more often include target-date funds, automatically enroll workers and have better plan governance, according to Morningstar.

“We find that the probability of a plan offering these services is higher if the plan administrator is female, and the differences are statistically significant,” the authors wrote. “In other words, female plan administrators run better plans than their male counterparts.”

Over the past 20 years, women have been accounting for a larger presence on 401(k) committees. In 2000, only 30% of plan sponsor committees were women, but that increased to 50% by 2017, the report found.

The report is based on an analysis of Form 5500 filings made with the Department of Labor between those years. Morningstar examined whether the named administrator of a plan appeared to be male or female, using Social Security application data for names, to help determine the probability of administrator’s likely gender. For example, the name “Michael” had a more than 99% of indicating a male, while “Lisa” was equally indicative of being a female name. But names such as “Lee” and “Stacey,” which are less clear in specifying gender, required different probability figures.

While the data show that gender diversity among named plan administrators has increased significantly, overall diversity in the financial services area could use a lot of work, the authors of the report noted. On that subject, they cited a prior Morningstar paper that found there are more mutual fund managers in the U.K. named “Dave” than there were female fund managers of any name.

But there has been more recognition that businesses of all types benefit from the “diversity dividend,” meaning that if their leaders and employee bases represent a range “across genders, races, ethnicities, religions, ages, sexual orientations and physical abilities,” they are more likely to succeed, the authors noted.

“Companies have learned that the diversity of their salespeople, marketing professionals, executives and other employees should reflect the diversity of their clients and society in general in order to drive success and innovation,” the authors wrote. “Similarly, benefits professionals should better reflect the diverse gender, racial, sexual and religious makeup of the employees they serve in order to ensure that their benefits offerings result in productive, healthy and competitive workforces.”