Let’s take a look at some troubling stats. For starters:
- Today, 97.8 percent of allocated investment capital is managed by men.
- 41 of the Fortune 500 companies are led by women
- 14% of private equity fund managers are women, and less than 3% of venture capital is directed towards enterprises run by women.
Yet we know that when more women are involved in financial decision-making in households, in governments, with major corporations or investment funds, money is managed more efficiently and effectively, and investments are more profitable, and companies and governments make decisions that better benefit individual investors and the overall economy. This is what our guests this week refer to as the “ XX Edge.”
Patience Marime-Ball and Ruth Shaber are the authors of the book The XX Edge: Unlocking Higher Returns and Lower Risk, where they lay out how the field of gender-focused investing is about to be flipped, and how women will be placed at the center of investing as agents and actors. Part of this is because women are stepping more into our power every day, and we are ready for a change, but it’s also because decision-makers in major corporations and governments are waking up. They’ve seen that gender-inclusive teams are 21% more likely to see outperformance in profitability. They’ve seen that Female CFOs deliver a 6% increase in profits and an 8% stock performance bump compared to men. And they know that companies with female founders perform 63% better than those with all-male teams.
Patience Marime-Ball has more than two decades of investment experience across capital markets, including debt and equity financing, large scale infrastructure, distressed assets, as well as venture stage opportunities. She is the founder and CEO of Women of the World Endowment, an investment nonprofit focused on centralizing women as economic changemakers. Also, Ruth Shaber, MD, is thefounder 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.
Listen in as Patience and Ruth tell jean what the XX Edge really is, and what the inherent gender differences between women and men really are when it comes to financial decision-making. We also discuss the new paradigm of gender-focused investing, and what it looks like in 2022. (Newsflash: We all benefit from women being at the center of financial decision-making — and there’s data to back that.)
We discuss how women impact the bottom line in all industries, and what the financial risks are to an organization’s portfolio performance when they don’t invest in gender inclusivity: “We know that there’s a direct correlation between gender equality, measured on multiple indexes, and the stability of investments. And so while the data is more robust at the international level on these issues, we know that it’s going to play out at the state level in the United States as well,” Ruth says.
In Mailbag, we take a question from Rachel on real estate investing and starting to save late for retirement. And in Thrive, how to find a job that won’t cause you to rage quit.
This podcast is proudly supported by Edelman Financial Engines. Let our modern wealth management advice raise your financial potential. Get the full story at EdelmanFinancialEngines.com. Sponsored by Edelman Financial Engines – Modern wealth planning. All advisory services offered through Financial Engines Advisors L.L.C. (FEA), a federally registered investment advisor. Results are not guaranteed. AM1969416