Political, social, environmental, and economic conditions around the world are changing rapidly. Various efforts are being made to build a more prosperous society for everyone while responding to these changes. We believe that maximizing the power of both men and women is necessary for our efforts to be sustainable, inclusive, and inventive. Building an equitable society in which women can maximize their potential requires the removal of existing structural factors of gender inequality. It demands proactive involvement of society as a whole, including not only the public and social sectors, but also the private sector.
To achieve that goal, we employ the open ideas and methods of private foundations to help women gain economic empowerment. In addition to the traditional approach of supporting the social sector through grants, we focused on investment techniques that provide capital for growth in sectors where sustainability, scale, and incentives are critical.
By incorporating a gender perspective into investments, we aim to increase the flow of funds to programs that help women improve their economic activities, such as improving access to capital for women entrepreneurs in the region and boosting funding for women customers. This will help eliminate the structures that lead to gender disparities in economic activities.
What is gender lens investing?
Gender lens investing is a method that seeks to improve corporate, social, environmental, and investment outcomes by intentionally incorporating a gender perspective into the decision-making process. Incorporating a gender perspective will assist in mitigating risks, capturing opportunities, and investing more resources in women-led enterprises that bring value to women. To date, studies have shown that investing in women is not only beneficial to society, but also profitable.
Women have lower work participation and salaries than men, and women entrepreneurs lack access to the financing they need to grow their businesses (UN Women). However, women invest more of their money in their families and children as compared to men. Therefore investing in them has a social impact (United Nations).
By precisely understanding the demands of their female clients, companies that employ women in their innovation departments earn a 144 percent greater commercial success rate than those that do not (Coqual).
If gender biases such as the wage gap between men and women, disparities in access to finance and employment opportunities, social participation are eliminated and gender equality in labor is achieved, global GDP is expected to increase by approximately US$28 trillion by 2030 (McKinsey).
With a total AUM of US$7.7 billion, there are at least 192 gender investment products in operation that aim to expand financial access for women and women-owned companies, promote gender equality, and contribute to regional economic growth (according to the SPF's survey released in July 2020). This is a 61% increase compared to US$4.8 billion in 2018.
Growth was driven by private market funds, which, according to the Wharton Social Impact Initiative's Project Sage 3.0 report released in July 2020, raised $4.8 billion in total capital for private market gender investment funds, more than double the $2.2 billion raised in the previous year of the same report (Project Sage 3.0; note that the report data is as of December 31, 2019, derived from an online survey conducted in March 2020). Furthermore, the number of gender investment products in the private sector identified in the Project Sage 3.0 report was 138, up 58.6% from 87 in the previous year's report and 138 percent from 58 in 2017.
According to our research on economic empowerment for women, “entrepreneurship” accounts for the largest share of women's occupations in Southeast Asia. In addition, women's growing economic power has contributed significantly to national and regional economic growth, with women's small and medium-sized enterprises (SMEs) accounting for 30-53% of Southeast Asia's GDP. On the other side, we observed that access to money is a key challenge for women entrepreneurs in Asia.
In response, the Sasakawa Peace Foundation established the Asian Women Impact Fund (AWIF) in 2017 to promote gender equality and support women and women entrepreneurs in Southeast Asia. With its $10 billion investment, AWIF hopes to realize both financial returns and solutions to gender issues as Asia's first foundation and Japan's first gender investment fund.