Accelerate progress by investing in women now

“I've always thought of myself as a detective,” said Claudia Goldin, a Nobel laureate who won economics honors for her work on the gender gap. Her archival research with Professor Goldin has uncovered important data aimed at “rectifying the invisibility of women in official statistics”.

This recognition of Professor Goldin's work was monumental. She is a true pioneer because her work shines a light on the inconvenient truths of modern society and economics.

An excellent essay by British author, journalist, and activist Caroline Criado Perez, invisible women, “…the reason so much data doesn’t take gender into account is because bias and discrimination are built into our systems, treating men as the default and women as atypical… ”.

A recent first-of-its-kind report compiling corporate data on the gender pay gap in Australia highlights that much progress still needs to be made.

Releasing the report, Treasurer and Minister for Women Katie Gallagher said: “The gender pay gap is a persistent and complex problem, costing the Australian economy $51.8 billion every year.” .

Around the world, women are more likely to be unemployed, have insecure work, earn lower wages and face structural barriers to leadership.

All of this is in the face of data showing that companies that are committed to both strong internal gender equality initiatives and continuous operational improvement perform better.

And this doesn't just apply to the labor market.

This is a dynamic that permeates many areas of society, including health and medicine, and often has real implications for our well-being and prosperity.

Medical device research is just one example of the disproportionate risks women face when product testing does not account for gender differences.

Incredibly, until 2023 car crash test dummies will typically be based on the average male body, which explains why women are 73 percent more likely to be injured in a head-on road collision This might explain it.

further investment

Significant disparities still exist in finance and investment.

Around the world, women entrepreneurs and fund managers receive only a fraction of the money they invest, despite their superior returns.

A 2022 Deloitte study found that despite a 10x increase in startup funding over the past five years, only 0.7% of all private startup funding went to female founding teams in the same fiscal year. .

Another study found a similar pattern across Asia, noting that “women's entrepreneurship is key to economic stability…but access to capital remains low.”

This is despite data highlighting the benefits of diversity, such as companies with all-female teams having 63% better financial performance and 35% higher return on investment. Women-led venture-backed companies see a 12% increase in sales, and companies with 30% or more women on their board see increased profits.

When we look at leadership, significant tensions still exist.

The 2023 Global Director Survey reveals a deepening gender gap on boards. “While all female directors surveyed now believe gender diversity is important for boards, the proportion of male directors who agree is at an all-time low. ”

the driving force behind progress

Women are leading the discussion on sustainability.

On boards, female directors are more likely to believe that environmental, social, and governance issues are important to corporate strategy and have a measurable financial impact on performance.

It focuses on the potential of women as leaders, entrepreneurs, investors, consumers and decision-makers essential to economic growth, and puts women at the center of decisions that will shape our future. The “women's economy” is estimated to represent more market power than China and India combined.

And this is where we can look for opportunities.

Mobilize more women into the workforce, move more women into secure jobs and incomes, develop talent and advancement pathways, invest in fit-for-purpose care economy solutions, and build more sustainable infrastructure and Opportunity to enable environment.

If this potential were realized, the return on investment for society would be enormous.

All organizations can review their performance on diversity and gender equality. Those who see an opportunity will apply these tools proactively.

And this focus will only become sharper.

The UK Asset Owner Diversity Charter is currently signed by 17 asset owners representing around US$1.5 trillion of assets, and is part of a broader effort to achieve a more balanced and fair representation of our diverse society in investment. As part of this, we aim to embed and monitor diversity in manager selection and other processes. industry.

Australian institutional investors have joined the 40:40 Vision initiative, which urges Australia's top companies to set targets for gender balance at executive level by 2030.

And new tools and data are entering the market.

Networking platform 2X Global is growing and set to launch the global standard for gender-lens investing. A ground-breaking management framework, the SDG Impact Standards aim to highlight the imperative of gender equality and inform new ISO standards.

More companies are entering the market with a focus on investing in women.

Companies like Singapore-based Sweef Capital share expertise and structured frameworks to test, track and course-correct women's economic empowerment.

Impact Investing Australia and Capital Human have leveraged their experience across local and global markets to create a roadmap for investing in Australia to achieve gender equality, racial equality, diversity and inclusion.

Organizations have great potential to drive change through their internal processes, investment decisions, and spheres of influence.

There is clearly a need and ample opportunity for improvement. A greater focus on investing in women and how our investments impact them can result in breakthrough returns on investment that benefit us all.

Professor Addis has an interest in Sweef Capital Pty Ltd and chairs the Sweef Capital Gender ROI™ Steering Committee. She is also the founding chair of Impact Investing Australia.

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