29 Mar Three Takeaways from a Conversation Around Gender Lens Investing With Our Peers
Last week, SEAF Investment Associate Ingrid Chou participated on a Women’s Impact Investing Network (WIIN) Gender Lens Panel at UBS (with whom SEAF has partnered with on Align 17). Ingrid, joined by Beth Bafford from Calvert Impact Capital and Christine Roddy from the Alpha Mundi Foundation, discussed some of the biggest questions around gender lens investing. We share three of the key takeaways from the discussion.
1) There is a basic understanding that investing in women is, to put it simply, “just good investing”, but as Beth Bafford explained, what we need now is more data in both the public and private markets to continue proving and convincing investors of this business case. Beth relayed how investing in women is one of the quickest ways to access and generate wealth globally as women spend more money on average on their family than themselves. Investing in women makes financial sense, and recent studies have demonstrated that a majority of investors believe that gender equity is important. We’ve all seen the reports stating that companies with more gender diversity at the highest levels outperform those that do not. A Business 101 class teaches you to diversify your portfolio, and gender can play a key part in that strategy. Asset managers now need to find a way to move capital into this area and data will help tell that story. ESG can serve as a useful example of how gender lens investing can move into mainstream investment strategies.
2) There are a lot of misconceptions about gender lens investing. Christine Roddy explained that the perception around the subject ranges from unclear to vague to just plain wrong. Some investors view gender lens as simply checking a box, or as a hurdle or screen – similar to ‘green-washing’. There is confusion on how this type of strategy can be implemented and assessed. All three panelists agreed on the importance of measurement as a basic component of impact and is even more critical when it comes to gender lens investing. Ingrid explained how SEAF had created its own proprietary Gender Equality Scorecard© in an effort to better quantify the firm’s work in this area. Alpha Mundi uses a toolkit developed by Accumen and Unilever. There is a need for the development of more tools to guide asset managers, and at a very basic level, a need to educate the public that gender lens investing is real. The first step is to initiate the conversation. For example, climate investing is now seen as important and easy for people to understand how to incorporate into their financial strategies, but it took years to get there.
3) Gender lens investing is not mainstream, yet, but the market opportunities cannot be understated. As Beth Bafford put it, the status quo is against us, and implementing a gender lens investing will be time consuming, and can be resource-intensive, but the potential for both social and financial impact is immense. Women and girls have been underserved and overlooked for decades. The business of gender lens investing and women’s economic empowerment will, in time, become part of mainstream investment strategies. It just makes financial sense.