Ask a debt fund manager about gender-lens investing in their portfolio, and you’ll likely hear the same refrain: “We care, but our hands are tied. We’re lenders, not owners. We don’t have the leverage.”
In practice, this perception has often meant that encouraging portfolio companies to be more gender inclusive turns into a compliance exercise rather than a lever for value creation and real-world impact.
AFRIGREEN, a debt fund focusing on commercial and industrial solar projects across West and Central Africa, started from similar assumptions. While the fund had embedded gender KPIs into due diligence and built a strong ESG reputation, its leadership worried that pushing harder on gender inclusion would overburden portfolio companies already stretched thin. “It felt too complex to add another layer of reporting,” one member of the team said. “We don’t want to ask too much.”
The AFRIGREEN team, with support from FMO, engaged Value for Women to help them overcome their limited influence over portfolio companies, meet LP expectations around gender-inclusive practices, and develop a portfolio-wide gender strategy. What we learned working together and with their portfolio companies was surprising.
Rather than being reticent in the face of “yet more investor demands,” portfolio companies were hungry for, and appreciative of, more direction and guidance from their investors. This response paved the way for AFRIGREEN to step more strongly into its desired role as an active contributor to greater levels of gender inclusion in the sector.
A sector that wasn’t built with women in mind
In Nigeria’s renewable energy sector, where much of AFRIGREEN’s portfolio is concentrated, women hold only around 8% of technical roles. Addressing this gap is not simple: Only 22% of STEM graduates are women, so the hiring pipeline is limited. Moreover, the special-purpose vehicles financing commercial and industrial solar installations that make up the AFRIGREEN portfolio are built for financial efficiency, not operational depth. They are lean by design and contractor-led, with limited direct influence over workforce practices.
AFRIGREEN’s staff assumed the portfolio had limited appetite for gender engagement. But direct feedback from portfolio companies told a different story: Interviews and surveys showed that they were actively looking for support on adopting inclusive business practices and saw very clear business value in doing so.
Portfolio companies waiting to be asked
More targeted support on gender inclusion was, it turned out, a shared priority for multiple stakeholders. Rather than experiencing increased investor focus as an additional burden, portfolio companies welcomed it. Many AFRIGREEN portfolio companies were already responding to similar gender questions from other investors and had to develop action plans with lean teams and resources.
These companies pointed to very practical challenges that they wished for support on, such as attracting women into technical roles, retaining talent, building more diverse teams, and responding to expectations from multiple institutional investors. At one company, an investee shared their frustration: In a recent recruitment round for a technical role, just five out of 100 applicants were women, and none were ultimately hired. The portfolio used recruitment practices as a key entry point to bring more women into the talent pipeline, strengthen interview shortlists and ultimately fill roles across the companies.
These insights reframed gender for investors like AFRIGREEN, moving from “What do we require?” to “What can we offer?” The debt fund realized that it had to evolve into an enabler of gender action across its portfolio.
From requesting reports to enabling action
AFRIGREEN’s new portfolio-level gender engagement strategy offers a practical starting point for investors looking to move from gender data collection to gender action. Three lessons stand out:
- Start gender conversations early, and make them concrete: Rather than defaulting to data checklists, investors can use the due diligence stage to open practical conversations about gender-inclusive practices. A tailored conversation guide can help investment teams raise gender impact early in the process, with prompts that feel relevant to the business rather than only ESG checks and data asks. As one AFRIGREEN team member put it: “This gives us a concrete way to structure conversations with investees, instead of vague ESG asks.”
- Equip portfolio companies with simple, sector-relevant tools: Investors can support action by offering portfolio companies ready-to-use guidance on areas such as gender-inclusive recruitment, anti-harassment, equal pay and care provisions. These tools are most useful when they are adapted to the realities of the sector and made available in ways that respond to company demand, rather than adding another layer of compliance.
- Look for portfolio-wide solutions to shared constraints: Some gender inclusion barriers, such as talent pipeline gaps, are difficult for individual companies to solve alone. Investors can play a useful role by supporting shared initiatives across the portfolio, such as joint internship programs with engineering universities, peer learning on recruitment practices or co-sponsored access to women’s leadership forums.
What does this mean for other debt funds?
AFRIGREEN’s experience offers clear takeaways. The constraints are real, especially in male-dominated sectors like renewable energy where investors often have little say over day-to-day operations. But there is more room to act than most assume.
Importantly, ownership is not a prerequisite for influence. What matters most is how that influence is applied: through dialogue, structured expectations, practical tools and access to shared resources and networks that help portfolio companies act.
None of these actions depends on having an ownership stake or direct control over company decisions. They do, however, require funds to be clear about their role as enablers of action, rather than enforcers of compliance, and to offer portfolio-level practices that respond to real company needs.
When those elements align, LP requirements, fund manager objectives and portfolio operational realities can reinforce one another, generating the kind of sectoral impact that all parties can point to with pride.
Trina Roy is an engagement manager at Value for Women. Olivier Leruste is co-founder and managing partner at Echosys.
Guest posts on ImpactAlpha represent the opinions of their authors and do not necessarily reflect the views of ImpactAlpha.
