• Anaïs Langasque

Bridging Gender Financing Gaps with Gender Lens Investing in Developing Markets

Today is International Women’s Day which aims to celebrate women and advocate for their rights. The day has been observed for over 100 years in different forms and was first recognized by the United Nations in 1977. Since then, it has been celebrated internationally with different themes. The theme for this year is Choose to Challenge, which is about taking individual responsibility and choosing to challenge and call out gender bias and inequality wherever we encounter it. Collectively, we can all help create an inclusive world.


As we celebrate this year’s International Women’s Day, it is a great time to reflect on the achievements that have been made towards achieving gender equality and empowering all women and girls. It is paramount for all of us to be alert and challenge aspects that disadvantage women and increase gender inequality, and the effect this has on development outcomes.


Women’s inequality entails large economic costs for Countries and Globally


Women and girls play a key role as powerful agents of economic growth, stability, and sustainability. Women’s inequality entails large economic costs not only for them, but also for their households and countries. Globally, countries are losing $160 trillion in wealth due to disparities in lifetime earnings between women and men, which is about twice the value of GDP globally. With gender equality in earnings, global human capital wealth could increase by 21.7 percent, and total wealth by 14.0 percent.




Women account for only 38 percent of global human capital wealth versus 62 percent for men. In developing countries, women account for a third or less of human capital wealth. On a per capita basis, gender inequality in earnings could lead to losses in wealth of $23,620 per person globally. These losses differ between regions and countries because they tend to increase in absolute values with economic development. Achieving gender equality would have far reaching benefits for women and girls’ welfare, their households and communities, and help countries reach their full development potential, as well as achievement of the global agenda 2030.




International commitments to advance gender equality have brought about improvements in some areas: child marriage and female genital mutilation (FGM) have declined in recent years, and women’s representation in the political arena is higher than ever before. However, the promise of a world in which every woman and girl enjoys full gender equality, and where all legal, social and economic barriers to their empowerment have been removed, remains unfulfilled. According to data from the World Economic Forum compiled by Statista, it could take up to 257 years to balance the scales. With less than a decade left to 2030, it is critical to escalate the efforts being made to advance gender equality.




COVID-19 is intensifying the risk of violence against women and girls


Due to COVID-19, achieving gender equality is probably even more distant than ever before, since women and girls are being hit hardest by the pandemic. The crisis is creating circumstances that have already contributed to a surge in reports of violence against women and girls, and may increase child marriage and FGM. The coronavirus pandemic lockdowns have confined many women and girls to their homes, sometimes with abusive partners, putting them at greater risk of domestic violence. School closures and widening poverty as a result of the pandemic could put more girls at risk of early marriages. With COVID-19 interrupting programmes to end FGM, the progress earlier on achieved is being threatened.


Furthermore, women are likely to take on most additional care work owing to the closure of schools and day-care centres. They are also on the front lines in fighting the coronavirus, since women account for nearly 70 per cent of health and social workers globally. On an average day, women spend about three times as many hours in unpaid domestic and care work as men. Time spent in these activities tends to be even higher for women with young children at home. This burden is likely to get heavier during the pandemic which could have reaching effects on women’s ability to take on paid work.





Gender Lens Investing can help increase financing into women led enterprises


According to the Global Impact Investing Network, gender lens investing refers to investing with the intent to address gender issues or promote gender equity. It includes some of the following themes:

  • Investing in women-owned or -led enterprises

  • Investing in enterprises that promote workplace equity (in staffing, management, boardroom representation, and along their supply chains); or

  • Investing in enterprises that offer products or services that substantially improve the lives of women and girls


With regards to approach, gender lens investing involves following a given set of principles, processes and procedures to inform investment decisions.

  • An investment process that focuses on gender, from pre-investment activities (e.g. deal sourcing, structuring and due diligence) to post-deal monitoring (e.g. strategic advisory and exiting); or

  • An investment strategy that examines investee enterprises’: vision/mission to address gender issues; their organizational structure, culture, internal policies, and workplace environment; their use of data and metrics for the gender-equitable management of performance and to incentivize behavioral change and accountability; and how their financial and human resources signify overall commitment to gender equality.


All in all, gender lens investing aims to consolidate gender analysis into financial analysis by assessing the impact of investment opportunities on social and economic outcomes for women and girls, men and boys.


With gender investing becoming a major impact investment theme, there has been a growth in innovative strategies, solutions and products to increase gender focused investing. Different initiatives have been launched by catalytic and private investors alike aimed at bridging the gender financing gaps. For instance, in 2019, the World Bank, through its International Bank for Reconstruction and Development, launched a Sustainable Development Bond to raise awareness and finance for the achievement of the Sustainable Development Goal on gender equality (SDG 5).


How Investure supports Gender Lens Investing in developing markets


Our platform prioritizes gender inclusion, participation and equality in projects on the platform as well in terms of impact and outcomes of the projects. We apply a gender lens when evaluating projects to be listed on the platform giving special attention to projects with female sponsors, teams and beneficiaries. The big data generated by the platform helps provide analytics and reports on the impact and outcomes projects undertaken have on gender and inclusion.


In summary, Investure contributes in the following ways:

  • Generating pipeline of SDG and gender aligned investment opportunities: A major constraint facing impact investors is the lack of an investment ready pipeline, especially with investments that have gender and social dimension, a challenge likely to increase with the impact of COVID-19. Working with our local partners, Investure originates gender aligned investment opportunities and lists them on the platform.


  • Increasing the number of investors adopting an SDG and gender lens and attracting impact investors to developing markets. To date a small fraction of global impact investment reaches developing markets and the ecosystem is interconnected. Investure is digitalising, platforming and aggregating impact investors in developing markets and offering them a platform to syndicate transactions thus reducing the inefficiencies that exist today and attracting more impact investors to invest.


  • Creating a multiplier effect through partnership with catalytic financiers. Investure rallies and leverages catalytic capital to attract private capital to flow into SDG and gender aligned investment opportunities in developing regions.


Join Investure today, to bridge the gender financing gap and promote SDG 5 (and 10)! #ChooseToChallenge



Sources:

https://unstats.un.org/sdgs/report/2020/Goal-05/

https://unstats.un.org/sdgs/report/2020/Goal-10/

https://sdg.iisd.org/news/world-bank-launches-sdg-5-bond/

https://thegiin.org/gender-lens-investing-initiative

https://sustainabledevelopment.un.org/content/documents/2096Chapter%201-global%20investment%20requirement%20estimates.pdf

https://unctad.org/system/files/official-document/WIR2020_CH5.pdf


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