Gender equality is good for everyone. We know this. More gender-equal societies are healthier and better educated, more gender-equal workplaces are more harmonious, more gender-equal companies deliver better returns. Yet gender inequality is deeply embedded. Changing this will take time.
How about if you could do one smart, simple, big impact thing to advance gender equality now?
Wouldn’t you rush to do that, before you worked on all those slow-but-necessary social change steps? Of course you would.
Invest in women. And no, I do not mean donate to yet one more cause. I mean if you have any investments – and I do mean ANY, so those of you of modest means, keep reading – use them to invest in women.
The term “impact investing” was coined a mere 13 years ago, but the concept has taken off. Some of you may already apply a values or ESG* lens to your shopping or your investments – perhaps you don’t invest in fossil fuel companies or the tobacco industry or you don’t buy from certain stores.
So why not gender equality investing? Why would you spend time and effort and money advocating for women’s empowerment in your ‘spare’ time, and then put your money in companies which work against this cause?
Or, to look at it another way, if you advocate privately for pay transparency and more women in upper management, why are you putting your money in companies without looking at those very things? And shouldn’t you be trying to actively reward companies that are moving in the right direction?
Returns. I know, you’re thinking “Wait, this is my retirement. Will I get good returns?” Disabuse yourself of the notion that you must sacrifice returns to invest in gender equality. Just forget it. There are plenty – PLENTY – of safe, successful funds and company stocks which have made gender equality one of their priorities and can deliver returns you’d be happy to have in your portfolio.
So what does it mean to screen investments for gender equality? It can be either screening out gender equality laggards or seeking out gender equality leaders – or both. The indicators vary, but most involve some combination of gender balance in leadership, compensation equity, and policies promoting gender equality, including support for equal access to training and career development, parental leave, and prohibitions on violence and sexual harassment.**
I bet now you’re willing to try gender lens investing. Great. How? There are tons of resources, depending on what level of involvement you want. Some of you could read the links included here. Others could call up your investment managers and direct them to these resources.
If you want a very quick and user-friendly start, try looking up Gender Equality Funds. This handy site lets you search for mutual funds across a wide range of indicators in addition to gender equality – and financial performance is front and center. Very easy to use, trust me. Then read more below.
This is no longer a fringe approach with few investment opportunities. It’s big business. And it’s probably the single biggest way you can help advance gender equality. What’s stopping you?
International Endowments Network: Gender Equality All the links you want on this topic.
Repository of Gender Lens Investing Resources Created by the Global Impact Investing Network, a wealth of info.
The Gender Advantage: Integrating Gender Diversity into Investment Decisions Morgan Stanley’s take on the topic.
When Women Lead, Firms Win Excellent research by S&P Global showing company performance
Invest in Gender Equality for Strong Portfolios US News Money
The Investment Case for Gender Equality ImPax Asset Management analysis.
Money in Her Hands: A Virtual Fireside Chat with Arlan Hamilton (Backstage Capital) and Sallie Krawchek (Ellevest) UN Women USA MetroNY Event November 18, 2020
*ESG (Environmental, Social, and Governance) investing refers to all “sustainable investing.” This umbrella term covers investments that seek a long-term positive impact on society and the environment as well as positive returns.
** The indicators are being refined rapidly. Impact investing is changing the way we evaluate companies and it is helping push for more public information about how companies do business, including in the gender and diversity arenas.