How your investments can build a better world
Hundreds of the world’s most influential philanthropists and social investors recently gathered in Toronto for a global summit to discuss the world’s most pressing challenges.
The rally demonstrated how communities can work together to accelerate progress on issues that matter to people in Canada and around the world — the pandemic, the climate crisis, inequality, rising authoritarianism and threats to democracy.
Charitable foundations have an important role to play in helping communities make meaningful change possible. But now they are also appealing to traditional investors to achieve this.
In the past, many foundations relied almost exclusively on grants or charitable donations to fuel organizations in the face of these challenges. But a new tool has emerged – impact investing – that offers everyday investors, not just global philanthropists, a way to effect change.
Impact investing means finding ways to invest your money that will generate positive social and/or environmental returns as well as financial returns. It’s a chance to create profit and progress simultaneously.
Investing with a gender lens is one of the most striking examples. A growing body of research shows that female leadership and gender diversity in business are linked to higher returns. A study by S&P Global, for example, found that companies with female CEOs and CFOs produced superior stock market performance. He also found that companies with high gender diversity on their board were more profitable than companies with low gender diversity.
By funneling capital into businesses, organizations, and businesses like these, gender-lens investing fuels women’s financial opportunity and power.
At the Equality Fund, we are testing the promise of this idea on a scale the world has never seen before. Thanks to a historic $300 million contribution from the Canadian federal government, we’re on a mission to make the money work twice for women, girls and trans people: first, by investing in ways that advance the equality, and then using the returns from those investments. provide grants to women’s rights organizations and feminist movements.
The results will have a ripple effect around the world. Last year alone, we funded 128 organizations in 60 countries that fight gender-based violence, fight for women’s economic security in the wake of the pandemic, protect the rights of indigenous peoples and promote peace and security for all. .
Investors at all levels have the opportunity to participate in gender-responsive investing.
According to Veris Wealth Partners, the value of gender-responsive public equity and fixed-income investment funds accelerated to more than $12 billion (US) in June 2021, from $2.4 billion in a report by Veris Wealth Partners. 2018. And the growth of gender-responsive strategies in public markets is evidenced by over 200 gender-responsive investment deals generating a total of $6 billion in 2021. This is a market opportunity of over $18 billion. dollars.
For too long, some of our most pressing challenges have been ignored by investors. Not anymore. With principled innovation and a commitment to using all the tools at our disposal to drive change forward, the solutions are closer than we think.