Shifting Capital in Favor of Women, Girls, and the Businesses and Communities They Empower

Shifting Capital in Favor of Women, Girls, and the Businesses and Communities They Empower

“It will still take more than a lifetime to make equality a reality.”

This is the grim conclusion of the Global Gender Gap Report 2020 from the World Economic Forum. In fact, UN Women projects that the gap between a woman’s 77 cents earned and a man’s earned dollar won’t be bridged until 2069 and girls are still more likely than boys to never go to school (15 million girls compared to 10 million boys).

COVID 19: The regressive effect on gender 

COVID-19 has resulted in a substantial decrease in women’s participation in the labor force (its lowest point in 30 years). McKinsey estimates that the female job loss rates due to COVID-19 are roughly 1.8 times higher than male job loss rates globally. Domestic violence helplines have reported a 30-33% increase in calls during the pandemic. And women, because they make up 78% of front line hospital workers, are more likely to be infected by the virus than their male colleagues. COVID-19 has not only changed the world drastically, it threatens to reverse the progress made thus far and exacerbate gender inequalities furthermore.

Bold action is needed now: Why Gender Lens Investing (GLI) is key to recovery

It is now, more than ever, crucial to accelerate gender equality through the power of capital. This is Women of the World Endowment’s (WoWE) mission. The endowment invests at the intersection of gender and some of today’s most pressing social and environmental issues. It is singularly focused on driving impact at scale to improve the lives of women and girls in the context of an institutional- quality structure that can deliver market-rate risk adjusted returns. WoWE’s theory of change is founded in the belief that women, girls and marginalized people do not lack the willpower to transform their lives; they lack the financial power to achieve sustainable change. 

WoWE is building the largest endowment focused on women and girls ($5 billion) with a portfolio that is 100% dedicated to investing with a gender lens, and where the returns are deployed as grant capital to systems orchestrators supporting large scale solutions. WoWE has the ambition to support the launch of multiple gender lens investing products and disburse catalytic grants over the next 10 years, ultimately reshaping the GLI landscape.

Leveraging As You Sow’s Gender Equality Funds Tool for Impact and Returns

WoWE believes that investing at the intersection of gender and some of today’s most pressing social and environmental issues offers untapped opportunities for both strong risk-adjusted returns and outsized impact returns. 

As You Sow’s Gender Equality Funds tool is educational, helping WoWE to better understand the activities and policies of companies that make up the universe of mutual funds and ETFs we review for inclusion in our portfolio. According to As You Sow, “In order to align investments with values, investors must first know what they own. But since most investment portfolios and retirement plans rely heavily on mutual funds, it is nearly impossible for investors — foundations, endowments and individuals… — to know what individual companies they actually own.” That’s what the tools are solving for: by showing the companies embedded in the funds and thereby which funds align with our values, we can make informed investment decisions.

Beyond gender equality, WoWE uses As You Sow to learn about other intersectional themes and to construct a portfolio that is nearly military weapons-free, deforestation-free, fossil fuels-free, tobacco-free, civilian firearms-free and private prisons-free. The educational tools inform the focus of WoWE’s research on funds that score “B” or higher according to As You Sow’s ratings algorithm. And has resulted in a multi-fund, equal weight portfolio that is 100% GLI-aligned. Since inception, the portfolio has returned 18.4% as of September 30 (5.5% over its benchmark, MSCI World), demonstrating WoWE’s core belief that allocating capital in alignment with one’s values can yield risk-adjusted returns comparable to other market strategies.

WoWE works in collaboration with impact-focused partners such as As You Sow, the Tara Health Foundation, Equileap, and many others who share the same goal of accelerating GLI to achieve positive impact for women and girls. Patience Marime-Ball, CEO of WoWE, has an active collaborative role with As You Sow, most recently advising on the Prison Free Funds tool, as well as a member of As You Sow’s Racial Justice Advisory Committee.

Ultimately, WoWE aims to influence change by shifting capital in favor of women, girls, and the businesses and communities they empower. By collaborating with and learning from like-minded partners including from As You Sow’s innovative tools for its portfolio construction, WoWE has been able to take meaningful early steps towards its objectives and play its parts in influencing other asset holders.

Patience Marime-Ball is the founder and CEO of Women of the World Endowment.