Genderfluenced Investing Gets Dynamic During an Action Strategy Circle
By Guest Contributor
Robin Miller, SRI Scholarship Winner 2016
Women as investors and entrepreneurs are a powerful and growing source for good. Over the next few decades, $30 trillion in wealth will be transferred to a younger generation, and women stand to receive well more than half. Recognizing this, there is a growing body of evidence that using a gender lens investment strategy can promote both gender equality and financial returns. Gender lens investing, or genderfluenced investing, was the subject of an action strategy session at the SRI Conference in Denver this past year, and conference attendees had the opportunity to learn more about the approach.
What exactly is gender lens investing? Jackie VanderBrug, Managing Director at US Trust, coined the term as "making decisions which support gender equality while seeking financial returns." She gave a TEDx talk in 2012 on the subject and this year, she co-authored a book titled Gender Lens Investing: Uncovering Opportunities for Growth, Returns and Impact. You can read more about the basics of genderfluenced investing in a blog post from First Affirmative..
Having taken a course on women in management during my MBA which covered unconscious bias, the gender pay gap, and the lack of women receiving and deploying venture capital, I looked forward to learning about new tools and trends to promote the movement towards gender equity. I walked into the conference room excited to see chairs already arranged in a circle – a refreshing change from the less flexible structured panel discussions normally present at conferences. Patricia Hinnen, the Founder and CEO of Capital Sisters International facilitated the discussion. Hinnen founded Capital Sisters, a microlending platform for women in poverty that has raised $1.5 million through bond sales and distributed over 15,000 loans in its history. Hinnen previously spent two decades working on economic development, public policy and international affairs projects in more than 60 countries. Hinnen and the group launched right in to the inclusion of women on corporate boards and trends of women in venture equity. Here are some highlights of the discussion:
- There are a growing number of ways to engage in the genderfluenced investing across asset classes. Here are two examples: 1) State Street's SHE Index ETF which seeks to track the performance of the SSGA Gender Diversity Index. This index is comprised of US large cap companies with the highest levels of gender diversity on their boards of directors and in senior leadership and 2) the Pax Ellevate Fund, a broadly diversified mutual fund that invests in the highest rated companies in the world advancing women's leadership.
- There is an expanding number of networks promoting gender equity. One participant introduced ShEO, an initiative that seeks to address the statistic that only 4 percent of venture capital goes to women-owned businesses. ShEO pools $1,000 contributions from thousands of generous women into investments in a small number of women-led, socially-positive ventures. ShEO actively supports these ventures with zero-interest loans, guided development programs, and access to a global network of female investors, advisors and customers.
- Academic research is being applied to solutions for expanding opportunities. One recent success was the use of research from the Diana Project at Babson College to the Babson Breakaway Challenge. The Diana Project engages in research activities, forums and scholarship focusing on women entrepreneurs. Researchers from the Diana Project and Babson's Center for Women's Entrepreneurial Leadership collaborated on the challenge which seeks to bring gender parity to the venture capital space. This fall in Boston, the Breakaway Challenge hosted the first-ever, women-led venture capital competition, awarding $250,000 and a branding prize package to the winner.
We concluded the action strategy circle by making a commitment to taking action in our own spheres of influence. To become more involved with genderfluenced investing:
- Vote for shareholder resolutions that promote gender equity, including closing the gender pay gap, getting more women on boards and senior level management, and promoting policies on parental leave that benefit all genders;
- Join the Thirty Percent Coalition, a national organization devoted to the goal of women holding 30 percent of board seats across public companies.
- Participate in the Adopt a Company Campaign by 2020 Women on Boards, which seeks to increase the percentage of women on U.S. company boards to 20 percent or greater by the year 2020 by writing letters to companies and filing shareholder resolutions. Sidenote, the percentage support for this and the Thirty Percent Coalition is key to continue to push companies in moving forward. We have seen many companies become complacent in diversity when they have a token female on their board;
- Offer to be mentor to women seeking to attain senior level management positions or corporate board seats; and
- Support micro lending to women-run enterprises at home or abroad.
First Affirmative understands that the ways we save, spend, and invest can dramatically influence both the fabric and consciousness of society. We believe that in addition to the benefits of ownership, investors bear responsibility for the impact our money has in the world. Are you making conscious decisions about the impact of your consumer purchase and investment decisions?
NOTE: Mention of specific companies or securities should not be considered an endorsement or a recommendation to buy or sell that security. For information on the suitability of any investment for your portfolio, please contact your financial advisor. Past performance is no guarantee of future results.
Posted: March 20, 2017