Gender-lens investing takes on greater urgency as women’s job losses and business failures rise amid virus lockdowns.
  • Pandemic highlights need to invest more in women utilizing so-called “gender lens”
  • Investing in women has proven lucrative while boosting women’s socioeconomic standing and promoting gender equality
  • Institutional investors used the gender lens as part of their criteria to put money toward $868 billion in assets in 2018, more than double the amount two years earlier, according to a report from US SIF: The Forum for Sustainable and Responsible Investment

As the staggering economic toll of the pandemic appears exacted more on women than men, voices are calling for fresh commitments to “gender-lens” investing.

Unemployment rates are rising faster for women and people of color during the current crisis, the latest data from the U.S. Labor Department show. Globally, women and girls are disproportionately represented among those hardest hit by the pandemic, according to both the United Nations and the World Economic Forum.

Now more than ever, this highlights the need for sustainable business practices, one of which is making investment decisions with an eye toward assisting women-led businesses and workforces, according to speakers on a panel last week organized by US SIF: The Forum for Sustainable and Responsible Investment.

“Any time there’s a wolf at the door, it’s really hard to pay attention to the termites in the basement,” Julie Gorte, senior vice president of sustainable investing at Impax Asset Management, said on the panel webcast last week. But “things that make companies sustainable also make them more resilient.”

Women are not only losing their jobs at a faster rate than men; they’re also being exposed to more domestic violence and getting stuck with more of the unpaid work during lockdown. Fewer women are being classified as “essential” workers, so they’re being cut from unskilled manufacturing jobs, and women-owned businesses predominate in sectors hardest hit by the virus, according to the WEF. On top of that, weaknesses in the healthcare system disproportionately affect women.

The WEF called for leaders to develop a better understanding of “women as workers, business owners and entrepreneurs” as they seek to reopen the global economy.

“All aspects — from accessing financial rescue packages, credit and unemployment benefits to removing barriers for women to perform higher-skilled and better-paid jobs — should be considered for the economic recovery to be effective, inclusive and sustainable, according to a statement from the forum.

While it may sound like the right thing to do, investing in women has also proven to be a smart financial move.

Having gender diversity in the boardroom and in the C-suite boosts companies’ equity and lowers earnings risk, Jackie VanderBrug, head of sustainable and impact investment strategy at Bank of America, said at the SIF panel. And just because many companies are struggling to survive during the economic downturn is no reason to backtrack, panelists said.

“It’s an investable approach,” VanderBrug said. “It’s not a way to ethically lose money.”

Investing with an eye to promoting gender equality and advancing the socioeconomic status of women and girls — the so-called “gender lens” — was used as a criterion in $868 billion in investment assets in 2018, more than double the amount from 2016, according to a new report from US SIF.

Having just three women on a board represents a “tipping point” in terms of influence, according to a study last year of the MSCI All Country World Index members. Women held about a fifth of the director seats worldwide, with the highest concentration in Europe, according to MSCI data through Oct. 31.

“The pandemic is deepening pre-existing inequalities, exposing vulnerabilities in social, political and economic systems which are in turn amplifying the impacts of the pandemic,” according to a policy brief U.N. Secretary-General António Guterres released last month.