Women across the world are increasingly driving social investments, entrepreneurship and even household consumption decisions. This is an important trend as they, according to the Case Foundation, inform actions and influence decisions not only in households, but also in constituencies and communities.
This means founding firms, even large institutions, need to create tools, products and services focused on attracting, marketing to and activating this important demographic in ways that are convincing and genuine.
A recent Calvert Investments report asserts that women, along with younger investors, will indeed drive the growth of the broader responsible investment industry. In a study of affluent women, 95 percent ranked “helping others” and 90 percent ranked “environmental responsibility” as important. And beyond driving the growth of Impact Investing, woman may be our greatest hope to unlocking the kinds of game-changing innovations required to solve the most persistent problems.
Turns out that women wealth holders exhibit more risk tolerance toward new and innovative solutions, once they have met the financial security needs of themselves and their families. As Sallie Krawcheck wrote in her thought-provoking piece, women investors exhibit a slightly different values-based perspective. More women want their investments to not just generate excellent returns, but also have a positive impact on the world they live in. And they’re willing to make some big bets to deliver on that perspective.
Women represent the largest market opportunity in the world. Globally, they control $20 trillion in annual consumer spending. In the next five years, it is expected that this number will rise to nearly $30 trillion.
For context, that is more than the two largest growth markets typically identified—China and India—combined! In the U.S., women control somewhere between $5-15 trillion, with estimates that they will control two-thirds of the consumer wealth in the U.S. over the next 10 years.
- The number of women-owned firms increased by 45 percent, compared to just a 9 percent increase among all businesses. That’s five times faster than the national average.
- Their employment growth increased by 18 percent, compared to a 1 percent decline among all businesses.
- Their business revenues increased by 35 percent, compared to 27 percent among all U.S. firms. That’s 30 percent higher than the national average.
This data reinforces the importance of ensuring that women continue to be aware of the momentum in the Impact Investing space. Remember, their purchasing power and, therefore, their potential social impact power is enormous—women control 39 percent of investible assets in the U.S. today. That number will continue to rise; women currently control 51 percent, or $14 trillion, of personal wealth in the U.S. and are expected to control $22 trillion by 2020.
