Scaling Gender-Smart Investment in Public Markets with Better Tools and Data: an Interview with Ruth Shaber
Ruth Shaber MD is the founder and president of the Tara Health Foundation, which promotes health, well-being, and opportunity for women and girls through innovative evidence-informed programs. She is also the co-founder and board chair of Rhia Ventures, a group of foundations and investors that collaborate to bring new types of capital and enterprise to the field of reproductive health in the United States.
The following conversation took place on February 18, 2020, and is the first of a two-part interview series.
What do you think the biggest barriers are to scaling gender-smart investing in public markets?
Two of the biggest barriers are the presumption that you can't have the same sort of financial returns, and that there isn't enough product. Neither of those things are true. There's also an assumption that impact investors can’t make any difference in public markets. I know many folks who are the most aggressive around gender in the private equity space, but haven't really thought about what they can do in the public space. And most of the world’s money is in the public markets. If we're really going to make a difference in how women have access to capital, there's a huge untapped opportunity.
How is the work you're doing addressing that?
Data is at the core of our work. If we really think that public companies can make a difference for women, we need to first define what making a difference means. So we have to know what “good” looks like, and have the evidence to support that. Then, if we can have some sort of fundamental agreement regarding what makes a company good for women, then we need access to data that identifies which companies are performing best around that definition of good. And then we need tools that allow everyone - whether you're an individual or managing a huge pension fund - to have access to the data so they can optimise their portfolios for both financial and social returns.
One of the commitments you made at the Summit in 2018 was around data standardisation. How's that going?
It's going well. We support Equileap because we think that they're the best in class in terms of public company data provision. One of the most exciting things that's happened since the last Summit is we've worked with As You Sow to integrate the Equileap data into their Gender Equality Fund tool, which allows you to assess the top mutual funds for how well they perform around gender. The Gender Tool is now integrated with their five other tracking tools that they'd already created, which look at fossil fuels, weapons, tobacco, guns, and deforestation. So you can look across a portfolio at all the social issues you might care about. This tool also allows you to assess the financial performance of these mutual funds. So, for the first time an investor can assess the social and financial performance of their mutual fund portfolio.
Standardisation is obviously a very difficult thing to achieve, there are so many different frameworks and methodologies, you can't compare like for like. Are you optimistic it's possible to get to a place where you can do that?
I don't think we all need to have the same frameworks. There can be three or five or even 10 good metric systems as long as there’s evidence to support them all. My background in healthcare is what gives me hope that we’ll be able to sort out the measurement chaos. Thirty years ago, healthcare measurement was a mess, everyone had their own definitions, their own measurements. Hospitals and doctors didn't want to report anything publicly. The amount of energy that went into resisting the notion of standardised measures was 20 times more than what it took to actually just do it. And now we not only have the standardisation, but the organisations that define the measurements are the same ones that that get paid to come in and get the data to report out. The whole industry of reporting in healthcare is thriving and, importantly, the standardisation of measures has actually driven performance improvement. Despite all the resistance 30 years ago, now the healthcare industry just accepts that you have to publicly report on these things, and it actually makes people healthier.
I think the same kind of standardisation and transparency is possible in impact investing. But, it will take an alignment around social issues that investors, consumers and workers all care about.
https://tarahealthfoundation.org/
This interview was originally published on LinkedIn. Image credit: Christina @ wocintechchat.com on Unsplash