Men are from Mars, women are from Venus. At least that is what many of us used to say on the school playground. Of course, we know now that we are all from Earth and that men and women are equally intelligent, capable and enterprising, and therefore should have the same treatment and opportunities.
However, we also know that equal does not mean identical, and in the context of impact investing, recent surveys have suggested that there are in fact differences between the genders. According to Morgan Stanley, female investors are almost 2 times as likely as male investors to consider both the rate of return and the social/environmental impact when making an investment. They are also more likely to see the financial benefits that good ESG practices can have for their investments.
When the impact investing movement started, women were more commonly seen as beneficiaries of social investments; a practice that is still important for marginalized groups. However, women have now firmly taken their places as investors in socially/environmentally-responsible finance.
The reason for this surge in female support for impact investing is not clear. Maybe as members of a demographic that has more commonly benefited from impact investing schemes, women are more conscious of the efficacy and positive outcomes of such investments. Some evidence also suggests that women have a greater desire than men to be informed and involved when it comes to their investments, and so a tendency towards investments that align with their own values is not surprising.
In addition to being very open to investing in socially and environmentally responsible causes, the female population is increasingly powerful in their ability to do so. Women are controlling more assets, getting more education and assuming higher professional positions than ever before. In the U.S., women control $11.2 trillion of investable assets, which is about 39% of the nation’s total, and by 2030, they are projected to control close to two-thirds of total private U.S. wealth.
If these projections are correct, this could provide significant benefits for social and environmental causes addressed through impact investing, as well as for the financial sector in general. In a field that has historically been male-dominated, the increased participation of women in, not only finance, but ESG finance, is a welcome transformation.
With greater gender balance and female empowerment in the financial sector, many women are helping to change the world by investing in funds and businesses whose practices lead to positive change. Just imagine what we could accomplish if everyone did it.
And speaking of enterprising women, CoPower’s Trish Nixon will be speaking at an upcoming breakfast put on by Women Investing For Impact (WIFI) on March 23, 2016 in Montreal! Get your tickets here.