According to UNIDO (United Nations Industrial Development Organization): imagine if women played the same role as men in the workforce, global GDP could increase by up to $28 trillion annually, or 26%, by 2025. Considering that approximately $5-7 trillion in investment is needed to address the key challenges outlined in the UN Sustainable Development Goals, investing through a gender lens is the best solution we currently have.
Gender-based investing (also known as gender-smart investing or gender-based finance) is an investment practice based on the understanding that gender is a crucial factor in financial, business, and social outcomes. The term was coined around 2009 and became an increasingly popular practice in the mid-2010s as part of efforts to reduce gender inequality.
Investing from a gender perspective can include funding businesses owned by women, businesses with a strong track record of employing women, or companies that improve the lives of women and girls with their products and services. Sarah Kaplan and Jackie VanderBurg of US Trust wrote about this practice, stating that "Women entrepreneurs and entrepreneurs worldwide are estimated to have a shared credit gap of $320 billion (the gap between the capital they are seeking and the credit they can access), creating a significant opportunity for investors."
The practice of using investment to promote gender equality dates back to the 1970s, with the creation of initiatives such as the World Bank for Women and Muhammad Yunus's Grameen Bank, which provided small loans to most female business owners in the Southern Hemisphere to facilitate their economic empowerment.
Gender-based investing emerged as a more clearly defined field in the 2000s and 2010s, when a group of investors and sector builders—including Joy Anderson of the Criterion Institute, Suzanne Biegel of Women Effect and then GenderSmart, and Jackie VanderBrug, co-author of the book "Gender-Based Investing: Exploring Growth, Returns and Impact"—began collaborating to increase the proportion of investment capital in female founders and to be moved by female investors. Early examples of gender-based investing in mainstream finance included the Valeurs Feminines fund in France, established in 2005 by the French money management firm Conseil Plus Gestion to invest in European businesses owned and led by women.
As of June 2023, the size of the private sector gender-focused equity market was estimated at US$7.9 billion. Total assets under management of publicly traded gender-focused equity funds were estimated at US$4.27 billion, with 44 equity funds specifically focused on gender-focused investments available for public investment.
Although there is some interest in gender equality among investors in Asia, the Middle East and North Africa, and Latin America, companies investing in gender equality remain primarily based in North America and Europe. As of 2024, 47% of investors interested in gender equality are headquartered in the United States and Canada, and 27% are based in Western, Northern, and Southern Europe.
Profit
Proponents of gender-based investing argue that companies with a higher-than-average percentage of women in executive roles tend to perform better, possibly due to diversity of perspectives or because non-discrimination against women allows companies to recruit the best talent available. A 2024 survey of gender-based investors conducted by the Global Impact Investing Network found that 77% of gender-based investments largely met their financial expectations, 13% exceeded expectations, and 8% underperformed.
An assessment commissioned by the UK Treasury has found that supporting women entrepreneurs could generate up to $250 billion for the UK economy. The report also showed that businesses run by women are less likely to achieve revenues exceeding £1 billion. Supporting women entrepreneurs would help bridge this gap.
Source: https://phunuvietnam.vn/dau-tu-theo-lang-kinh-gioi-len-ngoi-2025072221155295.htm
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