Championing economic opportunities for women in Africa – Development Partners International’s (DPI) latest fund to become the first 2X Flagship Fund
30 September 2020
DPI’s African Development Partners III Fund (“ADP III”) has been chosen as the first 2X Flagship Fund, committed to investing with a gender lens.
DPI’s long-standing commitment to gender equity, along with its fund’s commercial performance, recognises the power of DFI collaboration working alongside proactive fund managers to effect real development impact while generating commercial returns. DPI is intentionally supporting SDGs 5 (gender equality) and 10 (reduced inequalities) through its portfolio in Africa.
In June, the 2X Challenge exceeded its target by mobilizing $4.5 billion towards women’s economic empowerment.
The European Investment Bank (EIB), alongside CDC Group plc (CDC), the UK’s development finance institution, Germany’s DEG, FinDev Canada, FMO, Proparco, SIFEM and SwedFund International, have signed a Memorandum of Understanding with Development Partners International LLP (DPI), a leading pan-African private equity firm with $1.7 billion of assets under management, to become the first 2X Flagship Fund.
2X Flagship Funds are part of the 2X Challenge, a multilateral initiative launched by the DFIs of the G7 countries, with the objective of mobilizing $3 billion to support projects that empower women and enhance their economic participation. Vehicles awarded status as 2X Flagship Funds are established, high performing private equity funds, focused on emerging markets that have committed to investing with a gender lens using the 2X criteria.
With ADP III qualifying as the first 2X Flagship Fund, DPI is affirming its clear and long-standing commitment to advancing women’s economic empowerment and promoting gender equity both at DPI and within its portfolio companies in ADP III. Applying a gender lens helps investors unlock the multi-trillion-dollar opportunity that women represent in the global economy – as earners, women have a multiplier effect by reinvesting their income to grow their businesses, buy goods and services and improve the welfare of their families and communities. Current estimates indicate that women control 70-80% of consumer spending decisions, estimated at approximately $40 trillion globally (See Silverstein and Sayre, 2009: The Female Economy, Harvard Business Review)
DPI and all DFI members of the 2X Challenge recognise that in the private sector, gender equity drives higher performance and increased employee engagement - gender-balanced management teams typically demonstrate 10-20% higher returns (See IFC Report, 2019: Moving Toward Gender Balance in Private Equity and Venture Capital). DPI’s leadership team has strong representation of women in key roles, led by CEO and co-founder, Runa Alam, with 50 per cent of all Partners at the firm and of the Investment Committee being women.
Runa Alam, co-founder and CEO of DPI said, “We are extremely proud to be the first 2X Flagship Fund in the 2X Challenge, which reaffirms our commitment to advancing senior women and developing the pipeline of female talent in private equity. Working closely with our portfolio companies, we want to emphasize the benefits that gender-focused investing can provide, not just in terms of returns, but in helping to drive economies, unlock opportunities, and improve the quality of life for women across Africa. For DPI, signing on as a 2X Flagship Fund, is an important and natural step to reinforce our long-standing commitment to gender equity.”
Thomas ÖSTROS, Vice-President of the European Investment Bank (EIB) said: “I am very pleased that African Development Partners III, which counts the EIB as a major investor, is becoming the first 2X Flagship Fund. ADP III is a new private equity fund under the ACP Investment Facility that will support the growth of African businesses. I strongly believe that the fund will not only provide much-needed equity risk capital to African businesses and create jobs, but that it will also advance women’s economic empowerment. To accelerate development and reduce poverty we must tackle the obstacles that limit women’s potential. Gender equality is a core European value and as the Bank of the European Union, we are proud to support the 2X Challenge and its first flagship Fund.”
• Members of the DFI 2X Challenge include CDC Group, DEG, European Investment Bank, FinDev Canada, FMO, Proparco, SIFEM and SwedFund International
The “2X Challenge” calls for the G7 and other DFIs to collectively mobilise $3 billion to support women’s economic empowerment in developing countries. Fulfilling one of the four criteria of the 2X challenge makes an investment eligible. The four criteria are :
Development Partners International LLP (DPI) is a Pan-African private equity firm that invests in companies benefiting from the fast-growing emerging middle class in Africa with $1.7 bn in AUM. DPI has invested in 21 portfolio companies operating across over 30 countries. As a signatory to the UN PRI, DPI promotes high ESG and Impact standards and seeks to contribute to the UN Sustainable Development Goals. DPI is also one of the first African fund to become a signatory of the IFC Operating Principles for Impact Management. DPI has developed an innovative Impact and ESG Management System and key impact themes will focus on: Job Quality: SDG 8, Climate change: SDG 13, Gender balance: SDG 5.
As a 2X Flagship Fund, DPI has a commitment to gender and diversity alongside returns. DPI has a female co-founder and CEO, half of the partners are women, and over 45% of the firm are women.
About the European Investment Bank
To enhance the positive impact of its activities on gender equality and empower women and girls, the EIB Group adopted a Strategy on Gender Equality and Women’s Economic Empowerment and a Gender Action Plan, with the aim of embedding gender equality and, in particular women’s economic empowerment in the EIB’s business model. It covers its lending, blending and advising work within and outside the EU.
One year after the launch of its SheInvest initiative at the end of 2019, the European Investment Bank (EIB) reached its initial target to mobilise a total of €1 billion in gender-lensinvestment that is set to boost gender equality and female economic empowerment across Africa. Given the success of its initiative, the EIB now commits to double its ambition and mobilise €2 billion of gender-responsive investment across the continent.
The EIB has launched SheInvest, a new initiative to boost gender equality and female economic empowerment. The aim is to mobilise EUR 1 billion of investment that can benefit millions of women across Africa with better access to finance and by making sustainable infrastructure services and products work for them. This initiative was launched simultaneously at the Africa Investment Forum in Johannesburg and at the EIB headquarters in Luxembourg.
During the Finance in Common Summit, responsAbility Investments, a leading Swiss sustainable asset manager, commits to apply a gender lens to its investments through its climate fund. With this commitment, the climate fund, a private debt fund addressing lack of access to clean power primarily in Sub-Saharan Africa and South and South-East Asia, qualifies for the 2X Challenge. The 2X Challenge is a leading initiative deploying and mobilizing capital to empower women and enhance their economic participation in emerging markets.