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Not long ago, gender was a word seldom heard in the context of business strategy or investing. Today, investors, companies, and society at large are recognizing the importance of women’s empowerment and equality within their organizations and industries. Why? Because it is abundantly clear that advancing gender equality is both good for business and good for the world. 

So, what does gender have to do with it?

1. Diversity drives business performance

A study by McKinsey & Company affirms the global relevance of the link between diversity — defined as a greater proportion of women and a more mixed ethnic and cultural composition in the leadership of large companies — and company financial performance. Analyzing 1,000 companies in 12 countries, the study found that companies in the top quartile for gender diversity on their executive teams were 21 percent more likely to experience above-average profitability than companies in the fourth quartile. For ethnic and cultural diversity, an even stronger effect was found with a 33 percent likelihood of outperformance.

2. Women represent a growth market larger than China and India combined

Harvard Business Review reports that women control $20 trillion in annual consumer spending, a figure that is expanding rapidly as women’s earnings increase. In aggregate, women represent a growth market more than twice the size of China and India combined. Given those numbers, ignoring or underestimating the female consumer is a significant missed opportunity. And yet many companies do just that, even ones that are confident they have a winning strategy when it comes to women.

3. Gender-balanced teams produce higher returns for investors

According to Morgan Stanley Research, a more diverse workforce, as represented by women across all levels of the organization, was correlated with higher average returns. From 2011-2019, companies with more gender diversity enjoyed a one-year return on equity that was 2 percent better than companies with low gender diversity. Further, these more diverse companies experienced lower volatility.

The same is true for investment funds. Reviewing 700 funds and 500 portfolio companies, a report by IFC found that private equity and venture capital funds with gender-balanced senior investment teams generated 10 percent to 20 percent higher returns compared with funds that have a majority of male or female leaders.

4. Women are excellent investors

Gender lens investing is also about connecting with women investors. Many women feel disempowered about their finances and the way that they invest, and women are hugely under-represented in private market investing. In venture capital in the U.S., for example, just five percent of investors are women. It’s not hard to conclude that a lack of women investors contributes to a lack of support for women-led companies. 

It’s critical to close this gap, because research shows that women are better investors than men. Specifically, women spend more time researching their investment choices, tend to take on more appropriate levels of risk than men, and hold their investments for longer. All of these findings make for better investing outcomes.

5. Achieving gender equality worldwide would add $12 trillion to the global economy

McKinsey Global Institute highlights that gender inequality is not just a pressing moral and social issue but also a critical economic challenge. Mapping gender equality indicators for 95 countries, they found that 40 of them had high or extremely high levels of gender equality. If all countries instead operated with regional best practices for gender parity and women’s economic empowerment, it would add $12 trillion to global GDP by 2025 compared to a business-as-usual scenario. 

The same applies in developed markets like Canada; by taking steps to address women’s equality, Canada could add $150 billion in incremental GDP by 2026. That’s 6 percent higher than a business-as-usual GDP growth forecasts.

Achieving these goals requires that public, private, and social sectors act now to close gender gaps in work and society.

Want to learn more?

The rationale for gender lens investing is clear. Putting it into practice means consciously incorporating gender considerations throughout the investment process as a way to unlock market power, drive fairer and more equal economies, and improve your financial returns.

At Deetken Impact, we start with a deliberate and intentional commitment to making a difference in the lives of women and girls, while meeting the risk and return objectives of our investors. The Ilu Women’s Empowerment Fund is a pioneering fund to advance gender leadership in Latin America and the Caribbean. We support growth-stage, sustainable enterprises that are committed to advancing women as leaders, designing products and services that meet the needs of women, building equitable workplaces and creating more opportunities for women throughout the value chain. It’s a strategy that produces strong financial returns while driving meaningful change for women in the communities where we invest.

For more news and resources on gender lens investing, follow us on Twitter and LinkedIn.

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Magali Lamyin, Director of Communications and Development for Deetken Impact

MAGALI LAMYIN

Director of Communications and Development

 

Magali brings extensive market intelligence, business development and marketing experience from her work at the Central Bank of Mexico, the Canadian Institute for Market Intelligence, and the IESE-PWC e-Business Centre in Barcelona. She also co-led national marketing campaigns for businesses in the hospitality and early childhood education sectors for almost a decade before joining Deetken. In her current role, she is responsible for leading Deetken Impact’s communications, marketing and branding strategy. She is also involved in the due diligence process for project selection with an emphasis in Mexico.

Magali holds a BA in Economics from Mexico's ITAM and a Master's degree in Economics from the University of British Columbia.

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Jose Lamyin, Managing Partner Deetken Impact

JOSE LAMYIN

Managing Partner

 

José has extensive experience as a business advisor for clients throughout Canada, Europe and Latin America in mining, telecommunications, and finance. Prior to co-founding The Deetken Group, José worked for Teck Cominco in Peru and Canada and Deutsche Bank in London (UK). José has spearheaded much of the strategic growth of Deetken Asset Management since inception and is currently focused on investment selection.

José received his BS in Engineering from the University of British Columbia and MBA from IESE School of Business (Barcelona). Born in Peru, José is fluent in English and Spanish.

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Alexa Blain, Managing Partner Deetken Impact

ALEXA BLAIN

Managing Partner

 

Alexa is responsible for finance, operations and investor relations at Deetken Impact. She brings over 10 years of experience in financial consulting and asset management, with specific expertise in company and investment analysis, business valuation and securities/corporate finance. Prior to joining Deetken, she spent three years with African Alliance, a pan-African financial services group, where she focused on expanding the firm’s retail financial services operations as well as on the origination and negotiation of new capital. In addition, Alexa has six years of asset management experience with the Canada Pension Plan Investment Board, the Macquarie Group and the Ontario Teachers’ Pension Plan.

Alexa is a CFA Charterholder. She has also completed an MA in Financial Economics and an Honours BA in Economics, both at the University of Toronto.

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Fernando Alvarado, Head of Deetken Impact Sustainable Energy

FERNANDO ALVARADO

CEO

Honduras Renewable Energy Managers (HREM) and Caribbean Renewable Energy Managers (CAREM)

 

Fernando Alvarado leads the General Partner and Investment Advisor of two clean energy and energy efficiency project finance and venture capital funds: Honduras Renewable Energy Financing Facility (H-REFF) and Caribbean Basin Sustainable Energy Fund (CABEF), which he structured and runs with a combined target capitalization of $100m.

Development Investment Banker with 28 years of international credit and investment experience and 18 years of direct experience assessing diversified renewable energy portfolios in Latin America & the Caribbean. He has participated in more than 50 syndicated credit and investment transactions for renewable energy projects in excess of $250 MM. He led the creation, structuring, fundraising, legal closing and portfolio construction of several specialized renewable energy funds.

Costa Rican, based in San Jose, Mr. Alvarado has an MBA in Banking and Finance cum laude from Universidad de Costa Rica.

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Carl Black, Portfolio Manager Deetken Impact

CARL BLACK

Portfolio Manager

 

Carl is a Portfolio Manager with Deetken Impact focused on analyzing and working with MSMEs, social enterprises, and renewable energy developers in Latin America and the Caribbean. His main responsibilities include supporting business development, managing technical assistance projects, leading investment due diligence, and monitoring portfolio performance. Prior to joining Deetken Impact, Carl worked for five years as a consultant, advising public sector clients an non profits in Canada and financial services companies in Latin America. He started his career at the Bank of Canada, where he researched issues related to household and business credit. 

Carl completed an Honours BA in Economics at the University of British Columbia. He also holds an MSc in Economics & Development from the University of Oxford, where he earned distinctions in quantitative and development economics.

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Cristobal Aguirre, Investment Analyst at Deetken Impact

CRISTOBAL AGUIRRE

Investment Analyst

 

Cristobal has over 6 years of experience in the asset management industry, where his responsibilities have ranged from asset allocation and portfolio management to risk analysis and software development. Before relocating to Canada, Cristobal worked as a senior investment analyst in AFP Habitat—Chile’s largest pension fund—where he led the tactical asset allocation and macroeconomic research for emerging markets.

Cristobal is a CFA Charterholder, and completed a BA in Economics at Universidad de Chile.

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Chad Parsons, Senior Investment Analyst at Deetken Impact

CHAD PARSONS

SeniorInvestmentAnalyst

 

Chad has worked as a consultant in business and technology for 20 years – often helping clients with their business transformation initiatives.    He has worked with start-ups, government, and established businesses to further their product and service offerings with a balanced approach.   After pursuing a research degree on leveraging technology for social and economic development; Chad has found a valuable alignment of his background with Deetken’s innovative impact investments. 

Chad completed a BS in Engineering from the University of British Columbia and has a MSc with distinction from the University of Manchester (UK).

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