Don’t let the urgent crowd out the important: COVID-19, gender and climate change
If we don’t start taking an integrated approach to gender and climate investment, this moment in history won’t just be remembered for COVID-19: it might be remembered as the year we lost our planet.
By Suzanne Biegel & Sophie Lambin
As the impact of COVID-19 is felt in almost every corner of the globe, it feels like the only issue we should focus on. But we need to continue work to mitigate climate change and ensure that there is still a world beyond it. Climate is a ticking clock, and can’t be paused while we overcome this pandemic.
Last month, GenderSmart hosted the first virtual meeting of our new Gender & Climate Investment Working Group since the outbreak of COVID-19 . Research has shown that some of the most effective levers with which to fight climate change and deal with its catastrophic impacts are gender related. Earlier this year, Suzanne and Rebecca Fries co-authored an article in which they outlined six things investors and financial leaders can do today to drive impact on climate with a gender lens, and vice versa.
With the world facing severe financial disruption, the investment community needs to take a leading role to protect existing gender and climate investments and their beneficiaries in the short term, as well as to promote them over the medium and long term.
Look beyond the headlines: gender and climate investors are stepping up, and their investments are helping communities cope
COVID-19 is disrupting all our lives, from the richest cities to the poorest rural villages. It is also threatening the fragile interventions that have the greatest chance of fighting climate change effectively. The investment community is uniquely placed to help communities adapt to these effects, and to drive mitigation efforts. We have come across many organisations, investors and investees alike, doing incredible work since the outbreak.
“All this would not have been possible without strong support from the organisation’s investors, who understand that now, perhaps more than ever, clean energy entrepreneurs and rural women need their support. ”
Take India’s Frontier Markets, whose work takes a holistic gender lens to rural last mile distribution of everything from clean energy appliances, to smartphones that enable digital financial inclusion. While solar has not been recognised as an essential service at the national level, Frontier Markets has convinced state government of the importance of solar lighting at this time of crisis. This has enabled investors who take an integrated approach to gender and climate to combat unintended consequences of the emergency. For example, the lockdown has caused many urban workers to return to their native rural villages, swelling household numbers. At a time when the need for electricity and lanterns is greater than ever, both to fulfil basic needs and to support livelihoods, the approach has helped women entrepreneurs and the communities they support to avoid falling back on wood and kerosene. This is so important, given their dreadful impact on the health of women and climate.
Gender lens investment in energy access has often proven a gateway for tackling other gendered issues such as access to finance. This crisis is no different. Women in rural communities are also using Frontier Markets’ assisted e-commerce platform to access government subsidies and grants without leaving their homes or visiting a bank. All this would not have been possible without strong support from the organisation’s investors, who understand that now, perhaps more than ever, clean energy entrepreneurs and rural women need their support. To rally extra funds, they took a data-first approach to supporting their impact investors in making the case through special appeals to their LPs and ICs. Among those who stepped up were ENGIE Rassembleurs d’Energies, Teja Ventures, and Rianta Capital.
Preparedness pays dividends. Companies that were ahead of the curve and already building products that address market needs accentuated by the COVID-19 crisis are seeing growth and disrupting markets. A similar pattern will prevail in the climate crisis. For example, at least one investor who was reducing plastic and waste while supporting women entrepreneurs has found that their investees’ products are now deemed essential services. AIIM Partners Fund, whose portfolio takes an intersectional approach to improving access to jobs and equity for women and people of colour, invested in a women entrepreneur whose company manufactures a replacement for plastic bottles made from recycled paper. This company has successfully navigated an uptick in production since the pandemic surfaced - meeting the needs of clients whose medical and cleaning fluids are important to fighting the virus, as well as consumer preferences that will persist beyond the current crisis. Gender smart climate investments like these will have secured the livelihoods of many women in this emergency – similar investments will secure many more in the face of the climate crisis.
“Today, liquidity and flexibility are our queen bees. Mobilising capital for gender and climate investees is vital if we’re to help them weather this storm.”
These stories highlight gender-smart climate investments’ ability to withstand disruption and promote resilience across economies and societies. However, they don’t tell the whole story. COVID-19 also presents a serious challenge to those of us fighting for a greener, more equal future. We’ve heard that many asset allocators have failed to rise to this challenge fast enough, or at the scale required. And, even before the pandemic, our world sorely needed more money moving from the mainstream to targeted climate and gender-smart projects. In the race to stabilise and address the immediate crisis, there is a serious risk that short term thinking dominates our discourse in the weeks and months to come, causing promising gender and climate initiatives to fall by the wayside.
As we move from response to recovery, many will reassess their investment priorities. We must seize this opportunity to drive system-level climate action
Today, liquidity and flexibility are our queen bees. Mobilising capital for gender and climate investees is vital if we’re to help them weather this storm. But climate change will not wait for us to deal with, or recover from, this crisis. And temporary emissions reductions, along with increases in air and water quality associated with the shutdowns, have not bought us any time. That’s because they don’t contribute towards the system change we urgently need, and come at such great economic and human costs. Moreover, the UNEP tells us disease epidemics only stand to become more frequent,.
As we look towards recovery, the investment community should look to learn from the supply chain and market failures we’ve experienced, and to build more sustainable and impactful portfolios. This pandemic raises the importance of taking a long-term approach to our investment strategies – one that looks at gender and climate in concert. From women-led businesses who focus more on the long term and perform better on sustainability metrics, to the increased innovation seen in gender-diverse teams: women are early adopters of new practices and build resilience in communities that will be crucial in our climate fight. Scenario work has clearly demonstrated the strong rationale for linking women’s economic and social empowerment with our transition to a green economy.
Designing a Gender-Smart post-COVID-19 future through investment
As UN Secretary General António Guterres said recently, “We have a responsibility to recover better (than after the 2008 financial crisis). We have a framework for action – the 2030 Agenda for Sustainable Development and the Paris Agreement on Climate Change. We must keep our promises for people and planet.” Gender equality and empowering women and girls is a precondition for achieving all other sustainable development goals, particularly around climate.
That’s what the members of our Gender & Climate Investment working group are committed to advocating for through this crisis, across the full breadth of the investment community. The group brings together representatives from the full spectrum of the investment community: family offices, foundations, banks, DFIs, other institutional investors, fund managers, entrepreneurs, gender experts, and those working in gender and climate justice.
We’re pledging to pool our experiences and highlight the case for an integrated approach to gender and climate finance. Our conviction is that this has the potential to amplify the impacts of, and return on, investments, supporting their adoption in the mainstream with positive outcomes for women and the world, including increased resilience to emergencies today and into the future.
Suzanne Biegel’s previous article ‘Reflections on COVID-19: why gender finance is relevant, timely, impactful and important’ suggests a starting point for individuals from across the investment ecosystem who are kicking into emergency response mode and who want to understand where they can play a part. By taking a combined gender and climate lens to their actions, we believe investors can exponentially increase their impacts.
GenderSmart is committed to highlighting great work that is underway to address the climate emergency with a climate and gender lens. If you haven't already, please let us know what you are up to, and we'll be sure to amplify it.
Image: CC DFID on Flickr