Finding the why: A conversation about the power of gender-lens investing
As we wrap Women’s History Month, and DFC’s 2X Women’s Initiative concludes its fourth year, DFC’s Editorial Director Andrea Orr sat down with Algene Sajery, Vice President of External Affairs and Head of DFC’s Global Gender Equity Initiatives, to discuss the impact of the Corporation’s flagship gender-lens investing program. Algene also shares how her lived experience inspired her support for the initiative.
1. It’s been about a year since you assumed the role of heading Global Gender Equity Initiatives (GGEI) at DFC. What accomplishment(s) are you most proud over of the past year?
We have made tremendous progress for the 2X Women’s Initiative over the past year. We hired additional staff to advance the initiative and launched a technical assistance facility to deepen its impact. We also instituted a rigorous gender-lens investing training and peer learning program for every DFC investment officer, and the results are both measurable and significant. And I am proud to say that we are compounding our impact by collaborating with other DFIs and other parts of the U.S. Government, including through the White House’s Gender Policy Council. All this hard work has paid off. In fact, 43 percent of all the transactions DFC committed in fiscal year 2021 had a strong gender component. I am most proud of our 2X Champion investment teams who have worked diligently to structure innovative and deeply impactful investments targeting marginalized women.
2. You have worked on gender equity issues a long time and you are passionate about 2X. Why is women’s economic empowerment important to you? Why is it important to sustainable development?
Growing up, I was extremely close with my grandmother. Ma Laura, as she was affectionately called, was born in rural Liberia in 1930. She grew up in a time when her brothers were afforded private education, but her father did not invest in the educational pursuits of his daughters. Nevertheless, she was a serial entrepreneur, always selling and re-selling household goods and crafts in Monrovia’s outdoor, informal markets. Although she did not have access to credit, she was eventually able to save enough money to open her own small shop in Crown Hill. She was the CEO of her own business, managing employees, and earning enough to pay school fees for her four daughters and son. So, before I ever dreamt of working in international economic development, my grandmother served as a powerful role model, showing me how resourceful and resilient women entrepreneurs are, even with limited resources. That is why the work we do here at DFC is so deeply personal to me. I think of Ma Laura when I work with our 2X clients to help them scale their businesses and contribute to their communities. When we invest in these women, we invest in their employees, their communities, their children, and their grandchildren. The ripple effects of those investments often have the power to yield transformational long-term sustainable development dividends.
3. Much of GGEI’s recent work has focused on helping DFC’s investment officers approach each transaction through a gender lens, and with an eye towards impact. How does applying a gender lens help DFC achieve greater development impact?
I will give you one example. Think of an investment in a technology company — a sector that some may assume does not have a gender-specific angle. But if the investment officer applies a gender approach to the investment, they will think through multiple angles where women could benefit. They would look at the client company’s staff composition. If there is room for improvement, they would ask if the client would be willing to increase gender diversity or invest in training to help more women rise to senior positions in the company. Since the BUILD Act authorized DFC to provide technical assistance, we can now deploy that tool to help a young business develop and implement gender-smart business practices. Downstream, the investment officer may ask that same client to consider its supply chain and how the company could benefit by working with more women-owned or women-led suppliers.
4. How has GGEI strengthened the 2X investing criteria over the past year?
The 2X criteria prioritize investments that are owned by women, led by women, create quality jobs for women, and provide a product or service with a strong benefit to women. Almost four years since the 2X Initiative was launched, these investing criteria are now considered the global gold standard for gender-lens investors. Last year, DFC and the 2X Collaborative increased the threshold for the leadership criteria so that a client must have at least 30 percent women working in senior management positions to qualify for 2X. We also modified the counting methodology for financial intermediaries, asking these clients to meet eligibility requirements at the organizational (fund/bank) level, as well as with their portfolio companies in order to count 100% of the investment as 2X. Beyond the criteria, we are always looking to creatively work with clients to find solutions that better the lives of women in their communities. One conversation we love having with investment officers and clients is translating the 2X criteria into tangible, actionable steps they can implement. We use the criteria as the foundation for dialogue to move the needle forward on women’s economic empowerment, either within the client’s organization or across their lending portfolio.
5. Women’s economic empowerment is a top priority at DFC, but you’ve spoken about the need to continue to work to reach particularly vulnerable communities. Can you explain this need?
This is such an important question, and one that is incredibly personal to me. So please indulge me as I share my lived experience with you. I came to this country as a young child following a military coup in Liberia. My mother, brother, and I left Liberia with little more than the clothes on our backs. Some of my extended family stayed in the country and bore witness to a bloody 14-year civil war. Many of those who survived the war did so by fleeing to refugee camps in neighboring countries. Those left behind relied on humanitarian and development assistance to feed their families. So, when I think of those vulnerable communities that can benefit from DFC’s investments, those in post-conflict countries or refugees and their host communities, I think of my family. I think of how many children go from privilege to poverty, from well-nourished to hungry overnight, and how we can help their families get back on their feet. Many of our DFC colleagues have lived and worked overseas. They have seen the impact of conflict and poverty up close. That is why they came to DFC instead of working in traditional private sector financing. They — actually, all of us at DFC — believe in the power of our investments to transform communities.
As post-conflict countries stabilize, and as developing countries grow, some casual observers may see economic expansion or increasing GDP as good signs of progress, and they are. But at DFC, we understand that there is much more to that narrative. We know that many women in that country may not be able to share in its increased prosperity. Some may not have access to key services, and some might not even have the same rights as men to own property and participate in business. DFC is committed to fostering inclusive growth and maximizing the development impact of our investments. To do this — to truly reach the bottom of the economic pyramid — we know that we must apply an intersectional lens to our investment strategies by considering the multifaceted and complex obstacles to economic empowerment that vulnerable, marginalized, and underserved people face.
6. Are there any specific DFC transactions that have been particularly effective in empowering those women most in need of support?
That’s a tough question, because our 2X champion investment teams have truly blown me away with their innovation and creativity in structuring impactful deals. There are quite a few transactions in our portfolio that raise the bar on gender-lens investing.
Given your question on vulnerable populations, I will highlight one investment that illustrates our ability to use innovative financing approaches to support vulnerable populations. Last year, DFC provided a $10,000,000 loan to the Near East Foundation (NEF) to launch the world’s first ever Development Impact Bond (DIB) for refugees. The Refugee Impact Bond funds NEF to deliver a vocational, entrepreneurship, and resilience-building program for refugees and members of their host communities in Jordan and Lebanon. This investment demonstrates the power of partnerships, as DFC launched the bond in partnership with the IKEA Foundation, Novo Nordisk Foundation, Norad, Ferd, and KOIS. What’s unique about this investment is its results-based framework. Our donor partners provide funding to NEF to repay the loan and provide a return on investment if the program meets certain impact targets. In other words, NEF is incentivized to implement innovative programming that will maximize the economic impact of our investment for the women and families it will support.
Andrea, you know first-hand that when I learned of this investment, I almost jumped out of my chair with excitement at how game-changing it can be for humanitarian services. I could not stop talking about it — at every speech, every meeting about 2X. To me, Dia Martin, the project lead, and everyone on the investment team instantly became 2X MVPs. Indeed, all the 2X champions are MVPs.
DFC’s investments are incredibly powerful. Our 2X initiative helps women gain economic stability for themselves and their families. Perhaps more importantly, our investments have the power to restore a sense of dignity, a sense of agency, and a sense of hope to marginalized women and families. I can’t think of a better way to honor those women this Women’s History Month, and every day.