With the UN calling for investment in women to accelerate progress this International Women’s Day, Sydney-based international development organisation Good Return is appealing for socially-minded investors to lead the way. Its gender lens investment fund, backed by Australian impact investors, has enabled over 500 women-led SMEs in Indonesia and Cambodia to access $4.43 million in loans and proves a blended finance model can create real positive change for women in our region.
Women in business continue to face barriers to growth and economic participation. The International Finance Corporation has estimated that, worldwide, a $300 billion gap in financing exists for women-owned small businesses. In Australia, according to a report from Cut Through Venture and Folklore Ventures, just three per cent of total VC capital went to all-women-founded startups in 2022, while just 10 per cent went to those with at least one woman in their co-founding teams.
Women “overlooked and undervalued”
Impact investment – an investment that intentionally generates social impact as well as a financial return – is an opportunity to change the gender disparity when it comes to women’s access to capital. However, the most recent analysis from the Association for Women’s Rights in Development shows that less than one percent of global impact investments is going towards gender impact investment.
Diana Tjoeng, Good Return’s Asia Manager, says it is frustrating that the numbers are so appalling when it comes to gender-driven investment.
“While impact investing is gaining traction across the world, women and women-focussed products are overlooked and undervalued. Women have to work harder to access capital and prove the social impact of their business as well as the commercial viability,” said Tjoeng.
Gender-based impact investments drive social benefits and can back products and services that improve the lives of women and girls, can boost companies that employ more women in safer, violence-free environments and build women-focussed supply chains. These impacts are vital in emerging economies in our region.
Good Return’s Impact Investment Fund
Good Return CEO, Shane Nichols, says there’s an untapped win-win opportunity to be realised for both impact investors as well as women business owners.
“We have seen the powerful effects of linking ethically-minded investors in Australia with women-led business in our region. Our Impact Investment Fund uses an Australian-funded guarantee to back loans to women. These women are typically ignored by traditional lenders such as banks and we are demonstrating that they are worth investing in. To date we have not experienced any loan loss in the portfolio, and these businesses are generating employment in their communities”.
“The Fund also helps Australian investors meet their goals of driving sustainable change in our region and shifting the gender imbalance”.
One of the loan recipients is Mrs Sam Eng who runs a fish farm and fish wholesale business in Cambodia. Despite being a business woman for 20 years, it is only through Good Return’s impact investment program that Mrs Eng has been given access to finance to act on her business growth plans.
“As a result of Australians focussing their impact investment strategy on women, Mrs Eng now runs three fish growing ponds, employs four staff and is expanding to raise ducks to diversify her income. Her daughter-in-law has been part of the process and knows now that, as a woman, she too can be in business in the future,” said Tjoeng.
Macquarie Group invests in Good Return’s fund
Macquarie Group is an investor in Good Return’s Impact Investment Fund. Susan Clear, Director of Social Impact Investing at the Macquarie Group Foundation, highlights that Macquarie’s purpose is to empower people to innovate and invest for a better future and the Foundation leverages both financial and non-financial resources in its efforts to achieve the greatest social impact possible.
“We believe that when Australian financial institutions and the social sector work together, it fosters an environment to identify commercial investment opportunities that also have a positive social impact,” said Clear.
“With the UN calling for the tangible backing of women-led business, innovative financial products and investments are the way forward”.
Good Return is preparing to launch its next gender lens investment fund and is seeking expressions of interest from Australian investors. Visit https://goodreturn.org.au/impact-investing to find out more.