Markets are under-weighted women. And that’s a big problem for the global economy.
From fund management teams and board teams to venture capital disbursements and startup founders, the global economy is over-weighted men. We’re leaving talent, profits, economic opportunity, and yes…impact, on the table. We’re heightening levels of risk.
The benefits of women’s leadership, and their very presence, in the economy are becoming more widely known. The opportunity in 2018 is capturing those benefits with a new set of lens, intentional strategies and new investment and business-building processes.
1. Women’s progress is a global phenomenon. Ventures Africa, the pan-African business and innovation publication run by award-winning writer and medical doctor Uzodinma Iweala, queried its online community on the meaning of progress for women is in 2018. Progress means “demolishing norms embedded in our society that stifle women and points us towards only one type of happiness,” wrote Nicole in Accra, Ghana. “Men in denial must finally understand that though we are not the same, we’re equal.” Hear global voices.
- More from Ventures Africa: Nigerian engineers in hijabs: How these women are defying the-odds in a male-dominated industry
2. Women solve problems they know about, but need access to entrepreneurship. Inc42, the upstart India tech pub we watch closely at ImpactAlpha, rounded up the motivations of 15 women entrepreneurs. “I was forced to look for solutions to encourage my son to read as he absolutely hated it,” says Siddhi Trivedi, co-founder of Healthy Care. “I was lucky to work with another woman with the same problem and we built a great team to develop an educational gamification app to help boys read. Entrepreneurs solve problems they know.
- More from Inc42: Indian government think tank Niti Aayog today launched a ‘Women Entrepreneurship Platform,’ to boost access to entrepreneurship in the country. Cultural bias and lack of access to financial services has landed India at the low end of a country ranking on parity for women entrepreneurs from Mastercard Index of Women Entrepreneurs.
3. Broadening access to entrepreneurship is a very intentional process. Female founders received just 2% of venture capital in 2017. Founders of color grabbed even less. Time’s up. That’s why these New Revivalists are changing who build gets to build businesses in America…and who writes the checks. Check out the women standouts in ImpactAlpha’s New Revivalists series with Village Capital. Nine badass women.
4. Women are finding their way around obstacles in venture capital. We’re kinda loving the International Women’s Day edition of The Impact Journal, a periodical publication from Keene Advisors, an impact investment bank. A few of the times jammed into the artful 16-page pdf: An overview of obstacles women face in the startup and venture capital sectors, an interview with Sara Brand, founder of True Wealth Ventures, one of the newest impact venture capital firms and a list of lessons from Jenny Abramson and Heidi Patel in their first year running ReThink Impact, one of the largest U.S. venture capital firms with a gender lens. Check it out.
5. Women’s leadership is key to long-term economic outperformance. Two new reports, ‘Better Leadership, Better World,’ and ‘Powering Potential’ suggest women are the key to capturing the $12 trillion “economic prize” in delivering on the UN’s 17 Sustainable Development Goals to end poverty, boost social well-being and fight climate change. To win global growth markets like inclusive financial services, business leaders need to think long-term, innovate around complex social issues, and collaborate across markets and sectors, Research suggests these are the core competencies of women in business. The keys to economic outperformance.
6. Gender-lens investment strategies must be deliberate. A new report from the ImPact, a family-office network, surfaces strategies for investing to boost gender equity in the workplace, back companies building products and services for women and address the systematic exclusion or exploitation of women. Molly Gochman’s family office Stardust, for example, recently seeded Humanity United’s $23 million Working Capital fund to fight slavery and worker abuses in global supply chains. Choose your lens.
7. Board engagement works. Pax World Funds and Mercy Investment Services withdrew a resolution calling for diversity on board of US Foods Holdings, a major food distributor in the U.S., following an agreement from the firm to seek out qualified women and individuals from minority groups. Seven of nine companies Pax has engaged around board diversity have since appointed female directors. Ann E. Ziegler joined the board of US Foods Holdings in January. More here.
8. Board gender diversity is part of a larger picture of human capital quality. Research from investment research firm MSCI suggests firms with both gender diverse boards and high-quality talent management practices achieve higher employee productivity than their industry peers with either or neither. Additionally, firms with both diverse boards and strong talent management notched greater average dividend payout ratios and return on equity over a three-year period that firms with mostly male boards or poor talent management systems. The human capital connection.
9. Narrowing gender wealth gaps are an opportunity. Women’s share of wealth is growing faster than men’s. Women’s wealth grew from $34 trillion in 2010 to $51 trillion 2015. By 2020, assets held by women are expected to grow to $72 trillion, or about 32% of all assets, according to Boston Consulting Group. That’s an increase in the total share of wealth of four percentage points over 2010. Forward-looking investment firms able to serve women investors will profit from this shift. The Economist examines why the world will, too. Will you?
10. The pot of capital intentionally investing in women is still small, but growing. A gender-lens investing factsheet released by the Global Impact Investing Network details data on the state of gender lens investing. Either a fifth or a third of impact investors explicitly target gender equality, depending on the survey. Assets in public market securities grew 41% to $910 million last year, while Project Sage identified 58 venture funds with $1.3 billion in capital invested in women. The gender-lens investing factsheet.