As responsible investors who care about women and investing in gender equality, where should we focus the most attention? Are there ways that investors and the industry-at-large could be more intentional in “divesting from the patriarchy,” and becoming better allies of women in our struggle for equality and liberation? What opportunities excite us the most if the desire is to make a bigger impact on women’s issues?
Men still make up a majority of the senior-level positions in the finance industry. A research study by ADP from 2019 showed that the entire finance sector has one of the largest gender pay gaps of any industry sector, much of it due to the ways in which men move faster up the career ladder in finance than women. Let’s stop the exploitation of women’s labor. We want our whole damn dollar!
Gender lens funds have been around for a few decades. Despite money flow to these funds, the strong shareholder activism taking place with companies, and many publicly traded companies actively making changes in their organizations to address things like pay disparities across gender, we still have not seen a big societal shift toward a healthier culture.
A culture where we value a woman’s time and talent as much as a man’s, and where power and resources aren’t so concentrated in the hands of a few, despite signs pointing toward inclusion as being a best practice and an indication of better financial performance.
It is encouraging to see more attention from wealthy investors who can afford the risk of investing in women-led companies and startups through venture capital, angel investing, and private equity funds, but money is still not flowing equitably to these founders. At the same time, the emphasis on maximizing returns may be at odds with an investor’s desire to invest in less-extractive ways which truly help communities build wealth. Here are five ways to invest in gender equality:
1. CHOOSE INVESTMENTS THAT PROMOTE RACIAL JUSTICE & INCOME EQUALITY.
Women’s liberation is an intersectional fight! As investors, if we are more open and willing to move our capital to make an impact on multiple overlapping issues of discrimination, it may help investors feel less overwhelmed on how to engage in gender-lens investing. This may be especially helpful for investors who are skeptical about moving the needle on gender inequality solely through the public markets.
By choosing investments that promote progress on social issues like racial justice and income equality, we can make a very real impact for women and other marginalized communities. Here is a guide on “Investing to Advance Women.”
2. CHOOSE FEMALE ADVISORS TO MANAGE MONEY.
There are many more women in positions of authority managing money these days, a big improvement to a white-male dominated industry.
It is not hard to find highly capable female financial advisors and women fund managers across the public and private investment landscape. I feel very blessed to be able to work “in the trenches” every day with a slew of smart female colleagues who provide excellent advice to their clients and help them successfully achieve their goals, while challenging industry norms in both subtle and innovative ways.
My female colleagues are more likely to refer a client who would be a good fit for my practice, take time to seek or share knowledge, improve internal communication and practices, and call for more collaboration in the field. This is the type of networking that our male colleagues have been doing all these years! So, when women control capital, it is helping to break the glass ceiling for more women and people of color to succeed within the field of finance. Learn more about these issues in the NI Women Invested video series.
3. INVEST IN ALTERNATIVES TO CAPITALISM
You can further help change the investing landscape. Cooperative business models, microfinance institutions, and companies and fund managers that support and advocate for pay equity, unions, and workers’ rights are a few examples. There are opportunities to invest in gender issues in different asset classes. In the public markets, it is truly frustrating to see funds that focus on owning companies with a female CEO or more gender diversity in the C-Suite, yet the company is not being responsible from an environmental sustainability standpoint.
The opportunities within the public markets are not all that different than they were a decade or two ago. If we wish to move the needle for women’s equality and freedom on a macro level, then investing in alternatives to capitalism is a good idea!
4. DONATE TO WOMEN OF COLOR-LED ORGANIZATIONS
Focus on the ones that are organizing for policy change. The pandemic has exposed inequitable social policy issues that affect women’s economic and human rights. Organizing for pay equity, support for caregiving, paid family and medical leave, childcare for all, better workplace-family universal healthcare, and reproductive freedom, are all issues that impact women. When we donate to important causes, how much is going toward women-of- color leadership?
5. SPEND MORE TIME LISTENING TO WOMEN.
Listen to the experiences of women and people of other gender identities and learn how patriarchy is affecting them. Listening leads to learning how to change behaviors.
Overall, we hope that this article will help more investors understand that there are still ways in which we can leverage our investments to level the playing field. When we pay more attention to our investments and engage with our wealth, we can all be part of the solution toward a more equitable future.