Gender Investment & Innovation

Counting women to valuing women

How public market applies a gender lens to increase the flow of capital to gender equality


October 13, 2021
11 Min. Read
Gender lens investing (GLI) is an investment that intentionally focuses on the gender factors and makes investment decisions with the aim of improving not only financial returns but also getting better business, social, and environmental outcomes. It is a concept that is spreading worldwide as a key to gender equality, a common social issue faced not just by Japan but also the rest of the world.

The Gender Investment and Innovation Department at the Sasakawa Peace Foundation (SPF) held a breakout session entitled “Counting women to valuing women - How public market applies a gender lens to increase the flow of capital to gender equality” on September 28, 2021, as part of the "Impact Investing Forum 2021" hosted by the Global Steering Group for Impact Investment (GSG) Advisory Committee in Japan. In this session, SPF invited three experts to discuss the key trends of GLI in the public market, and the significance and potential of investment to create “gender impact” in Japan.

Session speakers (clockwise from top right): Itsu Adachi (SPF), Julia Enyart (Glenmede), Patience Marime-Ball (Women of the World Endowment), Seiichiro Uchi (Invesco Asset Management (Japan) Limited)

Itsu Adachi, Executive Director at SPF, kicked off the session, introducing the "Asia Women's Impact Fund (AWIF)" established by SPF to promote women's economic empowerment through GLI. He emphasized the idea that GLI is "not just the right investment, but the smart investment."

Next, Julia Enyart, Vice President of the Sustainable and Impact Investment Department at Glenmede Investment Management, an independently owned boutique asset management company with USD 40 billion in assets under management, introduced a report that the firm released last year, entitled, "Gender Lens Investing in Public Markets: It's More Than Women at the Top.” In the report, Glenmede Investment Management explores the next frontier of GLI, with a focus on identifying five dimensions (women in leadership, access to benefits, pay equity, diverse supply chains, and talent and culture) that prove how investing in women pays off. Among its findings, she emphasized the correlation between gender equity and corporate performance, which showed that companies with gender-diverse leadership demonstrate lower risk and higher sales growth, EPS growth, and return on assets. In addition, she raised that there is a global trend among investors moving toward investment strategies that they pay attention not only in companies with many women in managerial positions, but also look at qualitative aspects, and that going forward, investors need to continue to pay more attention to more granular corporate features, including not just diversified leadership but also to these five dimensions to achieve social outcomes as well as financial outcomes.

Next, Patience Marime-Ball, Chief Executive Officer at the Women of the World Endowment, stated that investing with gender lens by shifting financial systems to fully include them is our opportunity to build a sustainable future for humanity, and emphasized the importance of ESG investment (*) and gender impact investment, sharing cases on the effects of gender diversity on corporate performance as well as examples of private funds having good gender balance that outperformed their peers in annual returns. She also presented how Women of the World Endowment invests at the intersection of gender and other social issues with an aim to enable a positive impact in the lives of women, girls and their communities.  She shared practical information on tools and platforms, such as Ethos, which provides scoring for investments on key impact areas such as gender equality, racial justice, climate change, etc. She also explained the opportunities in the Japanese market, using stocks, bonds, sovereigns and sub-sovereigns as examples.

*ESG investment: A type of investment that considers not just the financial information, but also the environmental (E), social (S), and governance (G) impacts in assessing returns.

In the last presentation, Seiichiro Uchi, Head of Self-Index and ESG Business Development Investment Solutions at Invesco Asset Management (Japan) Limited, reviewed the situation of GLI in Japan. He first mentioned key milestones such as the selection of diversity-themed indices for ESG investment by the Government Pension Investment Fund (GPIF) in 2017 that provided momentum in advancing the concept of GLI, although the spread of GLI vehicles remains rather limited. Mr. Uchi explained how changes have been made in Japan through GLI since the GPIF's selection of diversity-themed indices for ESG investment in 2017, by showing several key data, such as how the number of companies with more than one female director increased from 40% to 72%. However, he said that in Japan, the proportion of women in managerial positions is still extremely low, and that companies without a comprehensive gender equity mandate may be exposed to unexpected risks and missed opportunities for long-term growth, and lack of gender equality and diversity is a systemic risk. Furthermore, in order to make changes, he mentioned it may also be necessary to utilize greater social power beyond the power of investment to solve such complex problems relating to the economy and society. Lastly, he mentioned the change that investors' interests are shifting from returns to returns + impacts, and emphasized that companies need to also move toward their ESG and impact purpose and enhance enterprise values. 

In the panel discussion session moderated by Mr. Adachi, Ms. Enyart first answered questions on how progress and changes have been made on quantitative information disclosure given the larger number of GLI vehicles in North America. She mentioned that women began to speak out problems such as sexual harassment in the workplace and various industries, and that the need to promote gender equality in the workplace became a common recognition, which helped to disclose important information which led to the creation of more GLI vehicles. In order to foster the field of GLI to mature more in the public market, she said that it is necessary for public companies to disclose data across the five dimensions of gender equity (women in leadership, access to benefits, pay equity, diverse supply chains, and talent and culture) by saying a more robust dataset may help identify factors for companies which can mitigate risk and drive long-term growth and progress toward true gender equity in the workplace. Regarding the hindrance of gender lens investment growth, she pointed out that data availability remains sparse, which is tied to the limited availability of GLI investment vehicles. (See figure below)
Next, Mr. Uchi shared his view on the reasons behind the slow adoption of GLI concept in Japan. He said that gender issues are complex and includes mixed determiants of social structural issues and issues of gender inequality at each corporate level. Mr. Uchi explained the importance of diversity by showing the data of how it would boost a company’s overall performance.  However, he stated the idea that Japanese companies tend not to think of gender issues as their own issues nor a risk, but rather consider them as greater issues within society as a whole, and pointed out that this mind-set is what sets back diversity and inclusion initiatives at the individual companies. He also argued that while social movements and shareholder pressure will keep playing their roles to trigger this much needed change, regulatory changes such as requiring companies to take on gender equity initiatives and to disclose ESG and impact data. He mentioned that while GLI can lead the way, it is also necessary to take collective action in order to make changes to the status quo.
In this regard, Ms. Marime-Ball echoed that being gender smart in the investment process and decisions can lead to many possibilities including creating better business performance through embracing diversity, better fund management and revenue generation, and more sustainable portfolio building. She also mentioned the importance of considering the “intersectionality” of GLI (Note: an approach that analyzes, understands and responds to the intersection of gender and other inequalities), as there are greater possibilities to bring synergy in solving various social issues and creating social change. Continuing on this topic, Mr. Adachi referred to the report entitled "Gender Diversity and Climate Innovation" released by Bloomberg NEF and the SPF, which showed the correlation between the promotion of gender equality in companies with efforts to address climate change and promotion of innovation.

In addition, Ms. Marime-Ball mentioned the need to get asset owners to utilize both financial and strategic capital to revitalize the flow of capital relating to solving gender issues in Japan. Specifically, she mentioned the overall cycle of data aggregation and analysis, translation of such data and analysis into investable strategies and products, seeding of new strategies with risk-adjusted returns and social impact, growing these SMAs, investing in the syndication of SMA strategies to the broader market, using convening power to develop standards, metrics, and frameworks, and to use strategic capital to influence other asset owners to look at impact when making decisions, and concluded that repetition of this cycle is key in making a greater influence.

In closing the session, Mr. Adachi stated that he would like to continue the discussions on GLI and collaborate with other partners in the efforts to take further concrete actions to solve these issues.
Ms. Julia Enyart
Panelist

Ms. Julia Enyart

Glenmede, Vice President on the Sustainable & Impact Investing team

Profile

An impact investor and strategist with over 12 years of experience, Julia Enyart is a Vice President on the Sustainable & Impact Investing team at Glenmede, an investment and wealth management firm with $40 billion assets under management. She is responsible for providing strategic oversight of Glenmede’s Sustainable & Impact Investing program, with a focus on ESG integration, portfolio construction, shareholder engagement, and investing in products with a thematic focus, including climate change, gender diversity, and racial equity.

Prior to joining Glenmede, Julia also worked with the Pallaidum Group’s impact investing team following a career in international development and management consulting. An emerging markets specialist, she brings experience conducting in-market due diligence in over 15 developing countries. Julia holds an MBA from the Wharton School and a Master’s of International Studies from the Lauder Institute at the University of Pennsylvania.

Ms. Patience Marime-Ball
Panelist

Ms. Patience Marime-Ball

Women of the World Endowment, CEO

Profile

Patience Marime-Ball has more than two decades of investment experience across capital markets – including debt and equity financing, large scale infrastructure, distressed assets, as well as venture stage opportunities. Previously, Patience was Principal Investment Officer and Global Head of Banking on Women at the International Finance Corporation (IFC) where she developed the Banking on Women platform; was responsible for the design of IFC’s Global Trade Liquidity Program; and co-developed the first-ever gender bond issued on the Uridashi market. Patience serves on the Board of MIO Partners and is Vice Chair of the Board of the International Center for Research on Women. She is a member of Apollo Global Management, Inc.’s Impact Advisory Committee; serves on the Investment Committee of Align Impact; is an investor in Purple Arch Ventures; and an early stage investor with Golden Seeds LLC. She serves on several advisory committees including As You Sow’s Prison Free Funds and Racial Justice Initiative as well as Emerging Sun LLC, a company she co-founded in 2005. Patience holds a JD from the Pritzker School of Law and an MBA from Kellogg at Northwestern University.

Mr. Seiichiro Uchi
Panelist

Mr. Seiichiro Uchi

Invesco Asset Management (Japan) Limited / Head of Self-Index and ESG Business Development Investment Solutions

Profile

Seiichiro Uchi joined Invesco Asset Management (Japan) Limited in February 2020. He has been in his current position since February 2021. Prior to joining Invesco, he was the Managing Director of Index and ESG Business in Japan at MSCI. Prior to MSCI, he worked at Standard & Poor's and the Tokyo Stock Exchange. He has a master's degree from Waseda University Graduate School of Finance.

Mr. Itsu Adachi
Panelist

Mr. Itsu Adachi

Sasakawa Peace Foundation, Executive Director

Profile

Itsu Adachi is an Executive Director at the Sasakawa Peace Foundation (SPF). He joined SPF in June 2020 to oversee departments and its projects related to conflict resolution and peacebuilding in Asia, labor migration, social integration, Japan-China relations, and advancing gender equality and women’s economic empowerment by supporting development of ecosystems for impact investing and inclusive entrepreneurship.

Prior to joining SPF, he spent 35 years leading international cooperation programs in developing countries at the Japan International Cooperation Agency (JICA). His portfolio covered a wide range of official development assistance projects in Southeast Asia, including post-conflict peace building and reconstruction projects in Cambodia as Chief Representative of JICA, Cambodia office. He also led cross-sectoral initiatives leveraging technological innovation and digital transformation in development projects. Mr. Adachi graduated with a Bachelor of Arts from Sofia University, Japan.

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