- The G7’s 2X Challenge once again exceeded its target, raising $16.3 billion from 2021 to 2022.
- 2X Challenge investments benefit 473 businesses across Asia, Africa, Central and Eastern Europe, Latin America and the Caribbean.
- A certification mechanism for the global gender finance industry is forthcoming.
The 2X Challenge, a flagship initiative under 2X Global first launched at the G7 Summit 2018 as a joint commitment by development finance institutions, today announced that it has exceeded its ambitious $15 billion target.
The initiative raised gender lens investments totalling $16.3 billion from 2021 to 2022, benefiting 473 businesses across Asia, Africa, Central and Eastern Europe, Latin America and the Caribbean.
Gender lens investments provide women with improved access to entrepreneurship, leadership opportunities, decent and skilled employment, enhanced access to finance and gender-smart products and services that enhance their economic participation.
Looking ahead: 2X Global’s leadership and the next frontier of gender finance
Gender finance is gaining prominence and has become a strategic priority for a wide range of capital providers in recent years, given a strong business and impact case as well as a strong nexus with climate finance.
The 2X investment criteria have quickly become a global industry standard, representing a shared definition and providing a set measurable metrics (that have been harmonised with other frameworks such as IRIS+, HIPSO and WEPs) of what “good” looks like in gender finance.
2X Global is now working with the global gender finance industry to evolve its standard towards what “better” and “best-in-class” look like, and will launch a certification mechanism in the coming months to further enhance transparency, assurance and rigour in gender finance.
CEO of 2X Global and Chair of the 2X Challenge Jessica Espinoza said: “We are excited about the continued success of the 2X Challenge in unlocking gender-smart capital at scale. Today, 2X Global convenes over 100 member institutions across all global markets, so the moment has come to open up the next 2X Challenge to the full spectrum of investors. We look forward to the next chapter of the 2X Challenge with an audacious new target to be announced later this year.”
Thomas Östros, Vice-President of the European Investment Bank (EIB), a member institution of the 2X Challenge, added: “The impressive results of the 2X Challenge prove how much gender-smart investment can shape a more equal and inclusive society. I am very proud that the EIB was the first multilateral development bank to adopt the 2X Challenge criteria and that we have been joined by others. I am looking forward to crowding in further investment guided by the 2X Challenge criteria that will advance women’s economic empowerment and gender equality.”
Lori Kerr, CEO of FinDev Canada, one of the founding G7 development finance institutions of the initiative, said: “The 2X Challenge has played a pivotal role in demonstrating the business and impact case of investing with a gender lens. 2X Global has quickly grown into a global industry body at the forefront of gender finance. We look forward to further scaling and deepening this impact by collaborating with 2X members.”
Spotlight on 2X-qualified gender-smart investments working toward greater financial and social outcomes:
Investments to foster innovation and resilience of gender-smart businesses in Ukraine
Horizon Capital’s latest fund — HCGF IV — has been awarded 2X Flagship Fund status under the 2X Challenge. The women-founded and led private equity firm invests in fast-growing tech and export-oriented companies in Ukraine and the surrounding region. In the face of Russia’s full-scale invasion of Ukraine, Horizon Capital raised $254 million in investment capital as well as tens of millions of dollars in humanitarian aid for the country, and have raised HCGF IV’s hard cap to $300 million to mobilise private investors prior to final closing in September. Anchor investments by select 2X member development finance institutions played a crucial enabling role. Horizon Capital has backed global success stories of women founders, including Creatio and BetterMe.
Access to capital and challenging pernicious gender norms as a route to tackling systemic inequity
Kashf Foundation is a women-led and owned financial institution in Pakistan. It meets all of the 2X criteria, with a female founder, a female CEO, 38% women on the board, 30% women in senior management, 49% women in the workforce, and 100% women customers. Beyond spearheading access to finance for women entrepreneurs, Kashf Foundation has produced and aired first-of-its-kind awareness raising campaigns on social issues through mainstream media, holding up a mirror to society on gender inequity while positioning women as agents of change rather than victims.
Women leading digital innovation for women
Across Latin America, the women-owned and led company Just empowers women creators at the bottom of the pyramid through a technology platform that enables them to grow their businesses, access global markets, and sell their products at a price premium to conscious customers. This opens up sales and development opportunities otherwise less available to female-led micro, small and medium-sized enterprises, and supports their business growth and capacity development through ongoing training and education.
Championing economic opportunities for women in Africa
DPI’s African Development Partners III Fund (ADP III) was the first fund to be awarded 2X Flagship Fund status. DPI’s long-standing commitment to gender equity, along with its fund’s commercial performance, recognises the power of development finance institution collaboration working alongside proactive fund managers to effect real development impact while generating commercial returns. DPI is intentionally supporting Sustainable Development Goals 5 (gender equality) and 10 (reduced inequalities) through its portfolio in Africa.
The European Investment Bank (EIB) is the long-term lending institution of the European Union and is owned by the EU Member States. It makes long-term finance available for sound investment in order to contribute towards EU policy goals both in Europe and beyond, including the UN Sustainable Development Goals. Set up at the beginning of 2022, EIB Global is the EIB Group’s new specialised arm dedicated to increasing the impact of international partnerships and development finance. It is designed to foster strong, focused partnership within Team Europe, alongside fellow development finance institutions and civil society.
To improve the impact of its activities on women and girls, the EIB has 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 covering its lending, blending and advising work within and outside the European Union.
More information on EIB gender equality initiatives
About 2X Global:
2X Global is a global membership and field-building organisation for investors, capital providers, and intermediaries working in public and private markets, across both developed and emerging economies. By working together with the full spectrum of investors, capital providers, mobilisers, and influencers, we shape the market on a whole new level, ultimately transforming systems of finance through the gender-smart deployment of capital across asset classes and markets.
About the 2X Challenge:
The 2X Challenge was founded by the G7 development finance institutions as a call to action to shift more capital towards investments that empower women in developing countries to access entrepreneurship and leadership opportunities, quality jobs, and products and services that enhance their economic participation.
What is a 2X Flagship Fund?
Vehicles awarded status as 2X Flagship Funds are gender-smart funds committed to both improving gender diversity in the investment industry (within the fund managers themselves) and also to investing with a gender lens to build gender-smart portfolios using the 2X criteria