Insights

How Women Are Driving Growth in Impact Investing

More women are discovering that opportunities in impact investing are empowering them to align their values with their financial plans

While women have long been considered the household purse holders and purchase managers, it’s only in the last several years that they’ve begun to exert their financial influence in investing and wealth management. Today, women are investing at higher rates than ever before, and choosing sustainable and impact investments that allow them to power positive change.

Studies indicate that women are more inclined than men to want their investments aligned with social and environmental values,” says Sue May Talbot, Portfolio Manager/Partner at Genus. “This means there is a growing and powerful group of impact investors made up of women for whom investing with purpose resonates.”

A different kind of impact

Elyse Crowston, VP, Operations at Active Impact Investments, had aligned her career with her values around sustainability and eco-justice, but was dismayed when she discovered that her home mortgage investment was in direct conflict with her work. At the time, she was working with Ecojustice Canada, a non-profit environmental law firm, where she waged campaigns against everything from pipelines to pesticides. “When my partner and I were getting our first mortgage, the Standing Rock pipeline protest was happening,” she says. “And I learned that although I was fighting these things in my day-to-day life, my largest investment was in all the things I was against. And you can’t unlearn that. The reality is that, in the background, there are forces contributing to the things you don’t value.”

“The reality is that, in the background, there are forces contributing to the things you don’t value.”
– Elyse Crowston, VP, Operation, Active Impact Investments

At the time, the term “impact investing” had not yet reached the popular lexicon. “The old model of sustainable investing was just about punishing the polluters,” Crowston says. “Now it’s about how to design the structures and incentives that create positive impact.”

Today Crowston is creating unique new opportunities for impact investors – many of whom are women – to get involved in early-stage impact investments, and for founders of sustainable companies to gain access to values-aligned investors. “Firms like Active Impact are encouraging women interested in sustainability to look at potential investees,” Crowston says. “We’re broadening opportunities to look at companies that are making a difference.”

A different kind of investment experience

While women have traditionally been under-represented in the financial sector on every front, from an investor perspective, Talbot believes it’s because most investment products simply do not market themselves effectively to women. “In this male dominated industry, many firms rely on broad assumptions about women, which results in services and messaging that are superficial at best and perhaps condescending at worst,” she says. “According to many of my female clients, prior to finding Genus, it was especially difficult to find an advisor to help align their investments with their personal values.” 

“As a portfolio manager, I hope to empower women to make investment decisions confidently, and to think of me as a collaborative partner.”
– Sue Talbot, Portfolio Manager/Partner, Genus

Talbot takes a collaborative approach with her clients, and focuses on establishing a personal connection. “As a portfolio manager, I hope to empower women to make investment decisions confidently, and to think of me as a collaborative partner,” she says. “When you have a personal connection to your portfolio, you become more interested in the holdings and therefore develop a deeper understanding of the investment strategy. This leads to becoming a more informed investor and an overall better investment experience.” 

Women-led product design

Alexa Blain, Managing Partner at Deetken Impact says there is plenty of research showing that the way women invest is different than the way men invest. “One aspect of this is that women are ‘risk astute’, meaning they are less likely to take large risks in anticipation of large rewards,” she says. “So we believe that the key to attracting women investors lies more in product design than in marketing.”  

Women are ‘risk astute’, meaning they are less likely to take large risks in anticipation of large rewards.”
– Alexa Blain, Managing Partner, Deetken Impact

Blain found that when Deetken issued impact bonds (which are less volatile than equity investments) as a way of investing in its Ilu Women’s Empowerment Fund, it attracted far more women. “It actually wasn’t designed with women specifically in mind,” she says. “But we were thinking about Canadian individuals who were new to impact, new to emerging markets and we designed a bond with characteristics for that market. We were really pleased that over 40% of the individual investors in that fundraising round were women. It was really encouraging and we’re going to keep building on what we learned.”   

The bottom line? Women want impact investments that are tailored to their needs, and want to work with like-minded people who understand their goals. “We see the connections between things,” Crowston says. “That’s part of the strength I see – being able to draw connections between cause and effect. There isn’t just one end goal – to make as much money as possible. We’re more ambitious than that.” 

 

Learn more about Women and Impact Investing, or talk to a Genus advisor to get started.

 

Disclaimer – Genus Capital

This document was prepared for general information purposes only and should not be considered a substitute for specific professional advice. In particular, its contents are not intended to be construed as the provision of investment, legal, accounting, tax or other professional advice or recommendations of any kind, or to form the basis of any decision to do or to refrain from doing anything. As such, this document should not be relied upon for investment or other financial decisions and no such decisions should be taken on the basis of its contents without seeking specific advice. This document is based on information available to Genus Capital Management at the date of issue, and takes no account of subsequent developments after that date. In addition, past performance is not indicative of future results. In producing this document, Genus has relied upon the accuracy and completeness of certain data and information obtained from third parties. The links to the issuer website are provided for convenience and we make no warranty or representation that any information is accurate and do not accept any responsibility for information posted on their website.

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Douglas H.
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Allan S.
“Back in 1992 when I found myself at fifty with a substantial amount of money to invest, I knew just one thing — that I didn’t want to contribute to tobacco companies, arms manufacturers, or oil. But over the ensuing years the options for socially responsible investing have become far more sophisticated and I’m very happy that this is a big part of the Genus approach. I also very much appreciate the long-term relationship with my portfolio manager, Mary Lou.”
Ann P.

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