How have you seen impact investors’ approaches to gender evolve over the past five years?
While still nascent, the focus on gender and inclusion as a criteria for impact investing has grown significantly. Data show that diversity is better for businesses and investors. This is driving both investors and businesses to be more thoughtful about how to move more capital to women-led businesses, and also how to support businesses and funds to ensure the composition and culture of their teams embraces and cultivates equality.
As impact investors target their portfolio compositions to include more women leaders and owners, many impact investors also now offer pre- and post-investment technical assistance to companies to deepen the way they integrate gender into policies and practices, employment conditions and also in how they design products and services, set up distribution, sales or customer care networks, for example. We also see the business case for these practices emerging.
More and more, impact investors are convinced that it is both right and smart to invest in women and people of colour, and are now seeking guidance on how to do it.
Are impact investors responding to covid-19 through a gender lens?
We see many businesses struggling, but we also see many new opportunities to innovate and to re-create. We have seen a growing focus on reconstruction with inclusion and impact at the core. Impact investors have an incredible opportunity to “build back better”, to tap into their full market potential and to increase their impact on the issues they care about, as well as to speed and strengthen the social and economic recovery from covid-19 itself.
In economies where women lose their jobs first and get them back last, it is very likely that we will see more women starting businesses over the coming months and years. Supporting those entrepreneurs will be an engine of both equality and economic growth.
How does gender intersect with other environmental and social issues, and what does this mean for impact investing?
An investment does not need to explicitly focus on gender to reap the benefits from using a gender lens. It is important to see gender as a lens, not a limitation, and the intersection with other issues is where it is most important. If you are investing in climate solutions, for example, adding a gender lens can triple your impact.
Gender, for example, is a key factor in designing sustainable energy investments such as clean cooking or solar energy solutions. The health sector also offers immense opportunity to level the playing field for those without access to basic services – especially for women. In a covid-19 world, there is also great opportunity to innovate on working from home solutions for parents and many others. Gender intersects with everything, and instead of complicating the way we do investments, it should broaden our opportunities and choices.
Rebecca Fries is chief executive and co-founder of Value for Women, a specialised advisory firm helping organisations advance gender inclusion.