How a Gender-Lens Investing Strategy Supports Women

Gender-lens investing is a way for investors to help their portfolios align with their values. It can include investing in women-owned or women-led organizations, enterprises that promote workplace equity or products and services that benefits women and girls.

There's growing evidence that you don't have to sacrifice returns for social good. By choosing investments in companies and funds that advance gender equity, investors can see positive financial returns while creating positive benefits for business and society.

What is gender-lens investing?

A form of impact investing, investing with a gender-lens means that investors seek positive financial returns while addressing inequities specific to women and girls.

Investors pursuing this strategy are looking for individual companies and bundled funds—such as exchange-traded funds and mutual funds—that take active steps to promote equitable conditions, benefits and opportunities for women and girls. These companies can't simply say they're an equal-opportunity employer to be gender-lens approved. Rather, they need to walk the talk. This can include taking such actions as:

• Supporting a higher percentage of women in leadership roles and board positions
• Promoting gender equity in vendor selection and hiring practices
• Creating products specifically designed to improve the lives of women and girls

What are the benefits?

This investment strategy's goal isn't to sacrifice returns for the sake of selecting companies and funds with an equitable interest in supporting women. Instead, gender-lens investing seeks to balance social impact with positive returns.

When investors align their portfolios with advocating for women and girls, they can experience numerous benefits, including:

• Knowing they're supporting companies that take a holistic approach to equality, diversity and inclusion
• Getting funds into companies led by women, which are often overlooked by traditional venture capital and angel investors
• Enjoying higher-than-average returns, as women-founded companies perform, on average, 63% better in the long-term than exclusively male-founded start-ups

Another less obvious benefit to gender-lens investing is helping to get money to women-led ventures overseas, especially in developing economies. By supporting these ventures, companies—and your investment dollars—are helping women across the globe earn fair wages and establish a higher quality of life.

How to get started

You can start by exploring the Gender Lens Investing Initiative from the Global Impact Investing Network. Here, you can learn about the investment strategy and explore studies conducted on gender-lens investing in recent years.

Next, you can look at your current holding to see how they stack up through a gender lens. You'll ideally be looking for how the stocks you currently hold individually or in funds stack up using available tools, such as the HRC Corporate Equality Index and the Glassdoor annual Best Places to Work list.

If you find that some of your holdings aren't hitting the mark for the interests of women and girls, you can research potential companies using those same lists. You can also research funds dedicated to gender-lens investing strategies using the Gender Equality Funds research tool.

Once you identify potential investments, always be sure that your choices align with your investment time horizon, tax strategy and risk tolerance. You can also work with your investment advisor to help identify and select the best investments for your needs.

Using gender-lens investing, you can use your buying power to strengthen equity and equality both here in the US and abroad. Potential monetary gains aside, you can sleep well at night knowing that the dollars in your investment portfolio are working to create a better, more equitable world for women and girls.