The women effect

Suzanne Biegel

Try this exercise. When you think ‘women’ and ‘investing’ what do you think about? This piece is going to ask you to think about the ‘women effect’ as a factor across multiple dimensions where ‘women and girls’ and ‘impact investing’ come together. Across all asset classes, and a variety of stakeholders.

Let’s put it right out there … women belong as investors (whether it’s their own capital or on behalf of others), as entrepreneurs, in management, and as board members. They belong in the picture of social impact as leaders in women-led enterprises, as participants in enterprises where women can create or increase wealth, as beneficiaries of investment, philanthropy or development aid. In fact they are key actors in almost any aspect of investment you might consider.

The case has been made about why women – and gender-diverse teams – make better investors, why you’d want women on boards, on a management team, on an investment committee, or running a hedge fund. The case has also been made that getting access to capital for women and girls lifts up their families, their communities, and indeed their nations, in a way that investment in men cannot. I’m not going to use my space here to debate these facts.

Investing with a gender lens
A gender lens in impact investing means considering how you can use your investment capital to have a positive impact on women and girls, and correspondingly to help solve the challenges that are the focus of our social investments and philanthropy. Whether we’re speaking about what are often called ‘women’s issues’ such as slavery and trafficking, domestic violence or maternal health (which aren’t ‘women’s issues’ as much as core ‘societal issues’) or about food security, healthcare, education, access to finance, energy, clean water, sanitation, you name it: women are the reality in the picture – though ironically often not in the picture when it comes to considering our investments.

And we must be as committed about getting women into the picture as impact investors, and therefore also as owners, board members and fund managers, as about investing with a gender lens. And this is not just about women. It’s about diversity, and the evidence that diversity, whether it be on teams or inside portfolios, enables investors to outperform their peers.

Some of the pioneers in the ‘women effect’ conversation are Joy Anderson (Criterion Institute),  Jackie Vanderbrug (US Trust, previously at Criterion) and the team at Calvert Foundation (there are too many women who have been inspirational to mention all of them here). Today, we could list dozens of women and men who have influenced this conversation, from the pioneers in impact fund management to those who started out in the early days of microfinance, SRI, community investing, and more.

The different dimensions of gender lens investing
Let us break down the different dimensions of investing with a gender lens, to better clarify what we mean. Joy Anderson and Jackie Vanderbrug talk about the importance of reframing. People will often jump to – ‘it’s another “screen”’.  Yet, we are not talking about a ‘screen’; we’re really talking about a true ‘lens’.  A screen implies narrowing.  A lens – or in this case lenses – helps you to see things more sharply, or differently:

•    The ‘access to capital’ lens focuses on investments that increase access to capital for women entrepreneurs and businesses with women as founders or co-founders.
•    A second lens looks at companies that create and increase women’s wealth – whether through ownership, financial participation or well-paying jobs.
•    A third lens is about investing in companies that generate value through products and services that benefit less advantaged women and girls.
•    (re)Value Gender is a fourth emerging ‘lens’, championed by the Criterion Institute, which focuses on revaluing gender in financial analysis.

(re)Value Gender asks us to ‘imagine complex gender analyses informing how we do investment analysis. How, if we understood the gendered nature of systems or structures in the world, would we shift practices or outcomes of calculating value through investment structures? Equipped with a gender lens, we see different opportunities, different risks. We are smarter investors; investors with an edge who capture value others are missing.’[1]

A related question, and one upon which Joy Anderson spends a lot of time, is: can movement builders (often funded by philanthropy) shift capital markets in support of ‘women-focused’ societal and social change? For example, can capital respond to the needs of those working on reproductive health, violence against women, slavery and trafficking? How can shifting financial flows have a positive effect on those issues?

Consider where the environmental movement was 20 years ago. People who wanted to talk about the environment and investing were (a) called ‘treehuggers’ and (b) told that it wasn’t going to be easy to find investment vehicles, analytics and valuations. Today, there is an entire market infrastructure and ecosystem that takes into account ESG (environmental, social, governance) and climate-related investment analytics. Now consider where the realm of gender lens investing is today: about where we were 20 years ago on environment. Fortunately, this is starting to shift, and we don’t need 20 years to make that shift.

Gender lens investing in practice
I invest across almost every asset class with a gender lens. I also set up and run the angel network Clearly Social Angels (CSA) for private investors who want to use their investments to support social impact businesses that are creating sustainable change. At CSA, almost 50 per cent of our investments have been gender-lens investments according to one of the lenses above. Insane Logic, for example, uses innovative iPad applications to allow children and adults with speech and language difficulties to communicate. It is led by entrepreneur Zoe Peden, a woman who is trailblazing in the ‘tech for good’ space. Four of our 10 completed investments are in women entrepreneurs.

Another investment we made was in Fair Finance, an organization that has a high number of women employed and also provides services that offer huge benefits for disadvantaged women: they help the financially excluded access finance at affordable rates; offer microfinance to entrepreneurs; and provide advice and support to the over-indebted. Seventy per cent of their customers are women.  The fact that this is a male-led business does not diminish its effectiveness as a ‘women effect’ company.  Through investments like these, our angel group can see our capital working to develop women entrepreneurs and support some of the most disadvantaged groups in society.

The world’s big players are moving behind gender lens investing – from Goldman Sachs announcing a $600 million fund for investing in women entrepreneurs globally to Calvert Foundation’s Women Invest in Women programme and the work of development finance institutions, philanthropists and more. People are beginning to recognize the ripple effect of an investment or resources in women’s hands and they are beginning to invest, fund programmes or make grants to make these investments happen.

Women as investors
Our CSA group is also rare in that half of our 40 members are women. In angel investing in the UK, it is estimated that the usual figure is more like 6-8 per cent.  This diversity helps us to question our investments for their impact on women; it means that we look for gender equity on boards, and in senior management teams, and we actively look at gender as a factor in predicting the success of a venture.

Women today represent significant capital in the Global North, and will inherit 60 per cent or more of the wealth in the intergenerational wealth transfer over the next 20 years. Women accounted for 27 per cent of global high net worth individuals in 2010. I am obsessed by the idea of how the world would look if every woman that could be an active investor was an active values-based investor, using her values to inform her investment decisions. And what would the world look like if every investor – man or woman – took into account the positive or negative impact of their investments on women and girls? This means thinking about women and girls in a company, in a supply chain, in a value chain, and as customers.

Deciding what you want to focus on
Whether you are a philanthropist or an investor, how do you begin to move part of your portfolio into gender lens investing?

First, it means deciding what you want to focus on. If you built your wealth by building and selling a business, perhaps you want to support women who are setting up businesses that create a positive social impact. Maybe you will search for women entrepreneurs in whom you can invest. Or perhaps you will join a group like CSA, Investors’ Circle, PYMWYMIC, Go Beyond or Toniic, to make sure you have the choice of the very best entrepreneurs doing social good. You will perhaps look at venture or microfinance funds that prioritize women entrepreneurs, or at funds that have a positive effect on women as customers, beneficiaries or employees.

Others might adopt a particular sector or geographic focus. For one investor I work with, the goal is to make an impact by investing in women and sanitation. Although investing in a water and sanitation project in the Global South may not seem immediately like a gender lens investment, providing women with clean, safe water and sanitation improves their health; improves the health of their families; and frees up women’s time to work, or to invest in their families or communities. Such projects in emerging markets are certainly women-effect investments.

FluencyIf getting young, disadvantaged women into work is a key focus for you (with significantly more female 16-24 year olds not in education, employment or training than their male peers), you might invest in a company like Fluency in the UK, which trains young people (50 per cent women) in digital skills and supports them into work with small businesses (it also happens to be a company led by an inspirational woman entrepreneur, Sinead Mac Manus). (Pictured: Some of Fluency’s digital marketing trainees hard at work learning the tricks of the trade. Photo by Ian Anderson.)

Different ways to invest
Investing directly in a business, through equity or debt, is one approach. A more philanthropic approach might be to support the movement. This might mean investing in the infrastructure to allow these investments to happen. Root Capital’s exciting Women in Agriculture initiative, for example, was made possible by a philanthropic grant that catalysed the programme, which seeks to finance 200 businesses and reach 200,000 female producers in Africa and Latin America. Because of that catalytic philanthropic grant, now you can invest as a debt investor in that portfolio.

Another option is to provide the first-loss risk capital in an early-stage women-effect business, which then allows institutions and other individuals to add their capital into the mix. Some people provide grant capital to women entrepreneurs who need advisory and investment-readiness support from a social impact intermediary such as ClearlySo, or provide incubator or accelerator funding for women for a programme like Ogunte, Agora Partnerships or Astia, or even grants to conduct metrics research to ensure we are measuring the impact of our investments effectively.

Development finance organizations DFID, USAID and GIZ are funding private sector development focused on women and girls, along with philanthropists and impact investors, and corporate foundations such as Nike Foundation, Vodafone Foundation and others.

Another approach is to join a group of values-aligned investors such as CSA. Two other groups I’m part of – Women Donors Network and Ariadne – both have values-based investing initiatives, and the Aspen Network for Development Entrepreneurs (ANDE) has a gender lens investing initiative.

Whether you invest directly in a company through equity or debt or a venture fund, whether you join a group of values-based investors, or whether you use your philanthropy to prime the pump for impact investing in women, there is an opportunity to invest in a way that supports and empowers women.

How to get connected?
Join the Gender Lens Investing Forum on LinkedIn, read more on the Criterion Institute website around women-effect investments, explore Veris Wealth Partners’ Women, Wealth and Impact: Investing with a gender lens or talk to women and men who are doing this already. In our CSA group, our angels are fervently committed to the impact investing work they do, and they are always open to talk about it. Explore joining CSA or another values-based group of investors.

Or you could work with an accelerator, or mentor women entrepreneurs in frontier markets via the Cherie Blair Foundation or others, or in developed markets with any number of women’s incubators and mentoring programmes. There are so many ways to get involved, so start finding out what works for you. There are several new crowdfunding platforms focused on women entrepreneurs that have launched in the past year (PlumAlley and Portfolia are two of them). And watch for news about SheEO – the exciting new project (and book) from Vicki Saunders, based in Canada.

We are not aiming just to shift capital to women entrepreneurs, we’re aiming to shift capital markets entirely. By shifting market systems, we can reduce the entrenched gender inequity that diminishes the potential of the world’s women and girls and, subsequently, constrains the potential of our economies and our communities.


Suzanne Biegel is Catalyst at Large, senior adviser, Criterion Institute, and senior adviser, ClearlySo. Email

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Follow @zanne2 for gender lens investing

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