Why Gender Lens Investing Is Good for the World—and Your Portfolio

The movement toward greater gender equality is creating benefits at every level of society. And investors are taking note

WITH GENDER EQUALITY AND DIVERSITY under increasing scrutiny today, a growing number of people are investigating how to create gender-related change through their investments. Many are turning to an approach called gender lens investing. Others may have heard about it but are unsure what it is and what potential investment advantages it might offer. According to Jackie VanderBrug, investment strategist and co-chair of the Impact Investing Council in the Global Wealth and Investment Management Chief Investment office (GWIM CIO), gender lens investing is the integration of gender into investment analysis, with two main goals in mind: to make the world a more equitable place and to make a profit. "It's a way to leverage the market to support progress towards gender equality—in the workplace, the supply chain, the consumer market, and elsewhere," she says. "And simultaneously it's a way to identify areas of opportunity in the search for enhanced investment returns, sustainable growth and lower risk." Check out the video from the Economist Panel on Gender Lens Investing featuring Jackie VanderBrug

It's more than philanthropy

Perhaps it's no surprise that some investors equate the idea of investing to improve society with philanthropy, which generally does not involve financial returns. So, when it comes gender and investing, it's important to stress the "making a profit" side of the equation. Indeed, gender lens investing is considered to be a subset of impact investing, which itself is often described as "doing good while doing well." That is, investing to make a positive social or environmental change while receiving a return on your investment.

HOW YOU CAN MAKE A DIFFERENCE

Consumers, corporations and investors seeking to support progress on gender-related issues can help effect change in a number of areas.

Consumers, especially women, who control up to 80% of all consumer purchases, can choose to buy from companies owned by women or that are addressing gender issues.

Corporations can be more inclusive in hiring, branding and product development, potentially improving their standing in the marketplace, especially among women consumers. A global consumer products company, for instance, recently announced it would drop sexist stereotypes from its advertising.

Investors can analyze gender related data, pinpointing those companies that are making progress in this area and those that are not. They may also engage in gender analysis as a way to strengthen a portfolio, increase diversification and fine-tune risk.

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"It's a way to leverage the market to support progress towards gender equality—in the workplace, the supply chain, the consumer market, and elsewhere."
—Jackie VanderBrug, Investment Strategist and Co-chair of the Impact Investing Council, Global Wealth and Investment Management Chief Investment Office
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