Women and girls of all population groups are disproportionately affected by climate crises, but particularly in developing countries. persistently exposed to higher levels of poverty (and extreme poverty) than men, Women and girls are also more prone to be affected by climate disasters. In fact, in response to UN statistics, 80% of those displaced by climate change are women.
Because of persistent global gender gapClimate events take their toll Job security for girls and education, in addition to their access to health care, drinking water, food and other essential goods. Still, Research shows that they use their local knowledge Women have quite a bit to contribute To Adaptation to climate change although gender differences in legal resources and economic participation represent an obstacle your engagement.
As environmental, social and governance (ESG) investments proceed to grow rapidly, it’s critical to adopt a gender perspective in public funds focused on climate solutions. Why? Because the next proportion of ladies in leadership positions (WIL) advantages company performance, operations and risk management. In fact, gender-specific ACWI index corporations are higher at reducing carbon emissionssaid a 2021 MSCI report, while 2020 research found this Gender diversity on the boards of US corporations was correlated with higher renewable energy consumption, which in turn increased financial performance.
Gender Lens Equity Funds: Steady Growth
Gender Lens Investing directs resources to women-focused initiatives, women-owned businesses and corporations that reveal a commitment to gender and broad equality internally and thru their external relationships, services.
There are 32 gender lens equity funds available to non-public investors. In Parallelle Finance’s coverage universe, there are 14 global and 18 regional funds with a mandate to take a position in higher WIL and related gender metrics. These funds hold between 30 and greater than 400 stocks. As of March 31, 2022, their assets under management (AUM) totaled $4.1 billion, having grown 51% in 2021.
The 12 largest gender-lens equity funds, in hundreds of thousands of dollars, as of March 31, 2022
Do climate funds invest taking the gender perspective into consideration?
Renewable energy is a cornerstone of world efforts to combat climate change. Renewable energy funds spend money on solar, wind and other clean energy producers and related technology and repair providers. The 17 US-listed and three European or UK-listed funds in our data set have assets under management starting from $5.6 billion for the iShares Global Clean Energy Exchange Traded Fund (ETF) to lower than $5 as of March 31, 2022 million US dollars. The average track record of the funds is six years.
The 12 largest renewable energy funds within the dataset, in hundreds of thousands of US dollars, as of March 31, 2022
These funds don’t reap the advantages of diverse leadership and broader corporate equity.
Only 11% of US portfolio managers are women. It doesn’t have that number has improved significantly in 20 years. According to available data, only 13% of renewable energy fund portfolio managers are women, and 14 of the 20 funds don’t have any women on their portfolio management teams. In contrast, our research shows that over 50% of gender equity fund portfolio managers are women.
There are 110 unique top 10 holdings among the many 20 renewable energy funds. The table below lists the 21 corporations that overlap with the leading gender equity indices and datasets. Only seven appear in any of Solactive Equileap’s gender equity indices, that are based on Equileap’s evaluation of leadership and workforce equity metrics, pay equity and transparency, and workplace advantages and policies in public corporations. Among the highest clean energy stocks of the 400 corporations within the Bloomberg Gender Equality Index, only 16 appear on each lists and only 5 appear on the Forbes Statista list of women-friendly corporations.
Overlaps in key holdings: Renewable funds and gender lens indices, datasets and equity funds
Of the highest renewable energy holdings, only three — Enbridge, Meridian Energy and Schneider Electric — appear among the many 164 unique top 10 holdings of gender-lens equity funds. These three are also on at the least one in every of the index and record lists.
The results are clear: if renewable energy corporations don’t improve their WIL and other equity metrics, the sector will miss out on the associated performance and operational advantages.
The way forward: include equality criteria
BCG predicts climate change will set back gender equality by 20 years. Why? Because climate change disproportionately affects women and since women are underrepresented in the worldwide economy. In fact, women are being excluded from industries emerging in response to climate change, and given projections of $100 trillion to $150 trillion in global net-zero investment by 2050, in response to BCG, that is each for girls and for net -Zero bad news.
The data doesn’t lie: WIL is very important for all sectors and industries. Climate-focused equity and bond funds must apply WIL and broad equity criteria. This includes:
- Investing in women-led innovators, producers, and clean energy product and repair providers.
- Strive for greater gender equality in leadership, workforce, pay and workplace policies across all demographics in all of their funds and encourage fund holdings to develop supplier diversity programs.
- Invest in innovation to cut back climate-related displacement.
- Using shareholder representation tools to advance gender equality in corporations.
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