What does success look like in gender-smart investing? Here are 12 ideas.
In the gender-smart investing field, all of us are working hard to move capital and shift systems and institutions to work in more equitable ways. But we often don’t have time to stop and think really deeply about what the world we’re working to build looks like.
Recently, I sat down with the GenderSmart team to vision what success might look like in each part of the gender lens investing ecosystem, 10–20 years into the future. If we achieved everything we’re setting out to make happen, what would the world look like? What would it look like to have a truly diverse and gender-equitable financial system? And what are leverage points we need to get there?
Read on to spend some time in the future we imagined. And let me know in the comments below what you’re working on to help us get there.
1. Institutional investors are both diverse internally, and diverse in their investments. This isn’t solely about the amount of money invested, but also about creating the right structures, committing to transparency, and investing with intentionality. These big players are using their influence to work with investees on gender equity, mobilising co-investors and partnerships to move capital to gender-smart enterprises, and publicly talking about gender and diversity as a core component of smart investing. Their influence helps to normalise gender lens investing as just smart investing, making gender such a core part of ESG that we don’t need to call it out anymore.
2. Investors are equitably funding women fund managers — and all fund managers with a gender lens integrated into their work. Good fund managers are raising their full funds faster and more easily, instead of the status quo today, where many are still stalled for reasons I and others have written about extensively. Fund managers are also getting the financial support they need to assist entrepreneurs on equitable practices and products, and entrepreneurs see the value of being gender-smart. By 2030, many of the first-time fund managers that got backed in 2022–2024 are now thriving with their second, third, or fourth funds.
3. The advisory and intermediary community understands why and how paying attention to gender brings better opportunity and lowers risk. Consultants and advisers, including OCIOs, investment consultants, wealth managers and financial advisers, are tapped into diverse sources of investable opportunities. They are willing to back qualified first-time gender-smart fund managers. They are knowledgeable enough to help their clients invest with a gender lens, or if not, be able to bring in outside resources. And they understand what good looks like in gender as well as JEDI investing.
4. Women and historically excluded entrepreneurs are getting funded at equitable levels to men, with the right type of finance. As we’ve already seen, VC is not suitable for every entrepreneur, especially if you’re motivated by shifting the systems of capitalism at a deeper level. Investors understand that it’s not just about “investing in women,” but investing in women of colour, and in gender-diverse teams that are committed to investing with a gender lens. There is a diversification of types of capital, including blended finance. As a result, gender-smart businesses are being funded, growing, and replicating. They are contracting with more gender-smart entities in their own value chains. And they are using the wealth they have created to invest in turn in other gender-smart entrepreneurs.
5. Gender finance is part of every thematic lens, be it healthcare, climate, the future of work, the care economy, agriculture, or circular economy. Sector and thematic investors understand that gender makes a difference to the effectiveness of their investments. Their gender lens is conscious, committed, and well executed. We are well on our way to solving for climate adaptation, benefiting from the insights, talents, and innovations of women, and especially especially women of colour, rather than being limited by conscious or unconscious bias.
6. Many more women private investors are moving their capital with a gender and JEDI lens. Gender-smart vehicles are on the investment platforms they’re already using, and the advisors they work with are knowledgeable about investment vehicles with a gender lens. Many more women have become angels or venture investors. It’s easy to get a retirement plan with a gender lens. Financial media positively reinforces how core gender is to any ESG investment.
7. Male investors understand and champion gender-smart investing. At an institutional level, in policy, as regulators or advisors, and when managing their own private capital. As a result, women don’t have to spend their time fighting for capital based on their gender. Men mitigate their investment risks and build wealth by backing gender-balanced teams. And gender-smart policies and practices are enacted with greater velocity.
8. The number of gender-smart investors has grown considerably — and new investment actors are coming in every day. We have reached a tipping point where older investors rethink their priorities and new investors learn about gender-smart investing right from the start of their investment journey. Gender-smart investing is no longer the niche that it has been, and gender-smart fund managers, fintechs, and entrepreneurs are backed with their capital they need.
9. Gender lens investing is democratised. Retail investors can use their pension fund, platforms like C-note or Calvert Community Investment notes, collaborative lending platforms, angel platforms, cryptocurrency, and fintechs to invest in gender-smart funds and companies. There are low entry points into structured vehicles and funds of funds. It is easy to invest with a gender lens locally and globally, directly and transparently, with a level of security that protects retail investors and informs them of the risks. Larger actors including the public sector and foundations use their capital to help to de-risk new, democratised investment platforms to make them more accessible to more investors.
10. We have the gender finance talent and expertise that we need, to better inform investment decision making, advisory, and technical assistance. “Translators” who understand investment, gender, business, development, impact, and individual sectors are available locally and globally, ready to hire or to work on contract. As a result, more investors feel equipped to make smart allocations, more capital flows to funds, firms, and projects that demonstrate real commitment to gender equity, and better gender action planning and activities are performed, enabling better gender equity outcomes overall.
11. Investor power is fully leveraged to drive a shift in corporate behaviour, management, and processes around gender equity. Fund managers in public markets are using better data to examine and engage with companies on governance, leadership, management, employment, value chains, and customers. Data is accessible, transparent, reliable, up to date, and included in regulatory frameworks. Shareholder engagement and advocacy has supported the shift in compliance, reporting, and accountability.
12. Investment is informed by those who are closest to the problems we’re aiming to solve and the opportunities we’re looking to leverage. These voices may come from women’s movement builders, academic experts in gender equity, entrepreneurs and fund managers with lived experience of the issues they’re working on, or NGOs that are focused on serving women’s needs. Investors value these voices and there is positive reinforcement in the system for including those voices in a substantive way.
Over to you
I’d love to hear from people who are working on different parts of this mosaic. Let me know what you’re working on, and which one of these twelve points is most aligned with your current work in the comments.
And if there’s a leverage point you think is missing from this picture, let me know in the comments what you think we should add, too.
I look forward to continuing this conversation with you.