Are Women Our Economy's Financial Superheroes?

It’s March, which means we’re celebrating Women’s History Month here at SheMoney. March is a month set aside to honor women’s history and contributions, and I always love the content that is shared during this month, especially the research. Long-time readers of SheMoney will know that March is when I usually publish my annual list (or addendum to previous year’s lists) of the Top Reports To Support Gender Lens Investing, Giving, and Action. My obsession with collecting and amplifying research began in 1999 when Goldman Sachs published their seminal report, Womenomics: Buy The Female Economy. It was revolutionary, as it was one of the first reports that was produced by a corporate entity to talk about the financial power of women. At that time, I was a partner at Goldman Sachs, and I was in the process of transitioning into a role in the Executive Office, where my focus was, in part, to help attract, promote, and retain more women at the firm. Goldman had just hired the firm’s very first Chief Diversity Officer, Laura Liswood, and in so doing was making a clear commitment to advancing their human capital efforts. This idea of making ‘the business case for women’, meaning, making the case for the economic power and potential of advancing gender equity in inclusion, was just beginning. That was 25 years ago.

Since then, there has been an explosion of gender specific research outside more traditional academic settings, and I have spent the past 25 years collecting, aggregating, and sharing what I believe to be the top reports and research, a database of which can be found at SheMoney. There have also been hundreds, if not thousands, of books published that are dedicated to advancing women’s leadership and creating more inclusive cultures. And just this past week, SheMoney, in partnership with Zions Bank, hosted Barbara Annis, the author of five books, including the seminal work, Gender Intelligence: Breakthrough Strategies for Increasing Diversity and Improving Your Bottom Line Hardcover – May 13, 2014. It was a wonderful opportunity for a robust discussion with Utah leaders, both men and women, on the current state of inclusive leadership in Utah. Interestingly, when asked on a scale of 1 to 5 how they would rank the level of gender intelligence in our largest state employers, the answer was predominately a 1 from business leaders of both genders. In further discussion, there was a clear interest in doing better and an understanding of why it was a business necessity to do so. It is worth noting that this consensus was occurring amidst a growing local and national rollback of efforts that focus on diversity, equity, and inclusion.

All of which is why I continue to go back to the research and data. Good policy and practices should always be based on good data. That said, I’m not publishing yet another list of nearly 1,000 reports across multiple categories and industries. Instead, I would like to share with you a small (and hopefully more easily digestible) selection of 10 of my favorite reports from the past year, with a particular focus on those that speak to this question of the economic and financial benefits of inclusion, especially in the corporate context. I have pulled the key insights for each report to give you a preview of the data contained within them, but I strongly encourage you to dig into these reports and really take in what the data is telling us. Spoiler alert, inclusion and diversity benefits everyone. But don’t just take my word for it.

If you don’t see your favorite and noteworthy report on this list, please share in the comments below. 

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Honorary Report 

Women-omics: Buy The Female Economy, Goldman Sachs, 1999. 

I know I promised recent reports from this past year, but I have to start with an honorary report from 25 years ago. A special shout-out to co-author Kathy Matsui, who was at Goldman for almost 27 years, and more recently founded MPower Partners, Japan’s first ESG-focused global VC fund. I need to acknowledge that Goldman’s focus on this topic continues, and I invite you to read their most recent report, “Women (still) Hold Up Half The Sky”, published in June of last year. 

From Goldman’s website: “In August of 1999, Goldman Sachs’ Global Investment Research Division published a Japan Portfolio Strategy report titled “Womenomics: Buy the Female Economy.” In it, Tokyo-based strategists Kathy Matsui, Hiromi Suzuki and Yoko Ushio highlighted female consumption in the country as an important pocket of strength in the flagging Japanese economy. In addition to providing a list of 16 Japanese companies that either were poised to benefit from female consumption or were proactive in fostering female employment, the Goldman Sachs strategists argued that an increase in Japan’s female labor participation rate from the prevailing rate of 50 percent to 59 percent (the level in the U.S.) could boost the country’s real GDP growth in 2000-2010 to 2.5 percent per annum from 2.2 percent.

Matsui and her colleagues continued their research for the next two decades, advocating for workforce equality and making policy recommendations to close the gender employment gap in Japan. Further Goldman Sachs Research reports included “Womenomics: Japan’s Hidden Asset” (2005), “Womenomics 3.0: The Time Is Now” (2010), and “Womenomics 4.0: Time to Walk the Talk” (2014).

The term “Womenomics”—and the concept itself—gained the attention of the Japanese government, and would be adopted as a key pillar of reforms meant to revitalize the economy under Prime Minister Shinzo Abe in 2012. Since the publication of the 1999 report, Japan’s female labor participation ratio surged to a record 71 percent—surpassing the United States and Europe. The Japanese government also introduced policies improving parental leave benefits and mandating equal pay for equal work.

In 2019, twenty years after the publication of the first report, Kathy Matsui, Hiromi Suzuki, and Kazunori Tatebe wrote “Womenomics 5.0.” In the last report, the strategists estimated that closing Japan’s gender employment gap could boost the country’s GDP by 10 percent, and in a “blue-sky scenario” where the ratio of female vs. male working hours rises to the OECD average, the GDP boost could expand further to 15 percent.” 

1. Equileap: 2024 Gender Equality Report and Ranking

Equileap is one of my go to resources for research and data. They have published some of my favorite reports over the years, and they are one of the leading sources of data on gender equality and inclusion in the corporate sector. Their comprehensive 2024 report assesses nearly 4,000 companies in developed markets, and it is a veritable treasure trove of data. For one, it reveals a gradual improvement in gender balance with the average score increasing from 41% in 2023 to 44% this year. Additionally, legislative advancements, including the European Union's Pay Transparency Directive and measures in the Asia-Pacific region, offer hope for improved gender pay transparency. However, despite these positive strides, gender disparities persist, complicated by resistance to (DEI) data in the U.S. and economic uncertainties. This report encourages investors and asset managers to explore the underlying data to make informed decisions that contribute to positive social change. 

From Equileap: “Equileap is the leading organization providing data on gender equality and diversity & inclusion in the corporate sector. Our data enables investors to focus on the social aspect of ESG policies and practices and to enhance responsible investing with a diversity & inclusion lens. We research 5,600 public companies around the world using the unique and comprehensive Equileap Gender Equality ScorecardTM. We cover 21 indicators, including gender balance across the workforce, the gender pay gap, paid parental leave, anti-sexual harassment policies, race & ethnicity, support for gender-diverse employees, and more.” 

Key Findings: 

• Australian and UK companies dominate the Top 100 ranking 
• U.S. Companies continue to be poorly represented in the top 100 ranking with just 15 companies holding spots (17 in 2023), despite there being 1,598 U.S. companies in the dataset (representing 42% of the developed markets dataset).
• 41 companies out of 3,795 have closed their gender pay gap
• 33% of companies disclose their gender pay gap
• 32 companies achieved gender balance (40-60% women) at all four levels (board, executive, senior, management, workforce) 
• Only 11% of companies offer equal paid leave to parents
• Only 1% of U.S. companies provide 20 or more weeks of paid leave to all parents.
• The top 3 companies for gender equality are France, Spain, and the U.K.
• 65% of companies publish an anti-sexual harassment policy
• Top 500 companies are 2x as likely to have a woman CEO 

ENGAGEMENT OPPORTUNITY: Equileap will be hosting a webinar to present the data from this report on Thursday, March 14. This webinar will take place at either:

 9am CET/ 8am GMT / 5pm JST

Please register in advance for this webinar using the following link:

https://us02web.zoom.us/webinar/register/WN_9DSrkeouT0OKWUn979SE8A

or

11am ET/ 4pm GMT/ 5pm CET

Please register in advance for this webinar using the following link:

https://us02web.zoom.us/webinar/register/WN_qg-Ht8FBToyB_NDlPF-qdw

 2. Women in the Economy:  Lifting up women’s voices, wisdom and experience to build a gender-equitable economy. Aspen Institute, 2023 

What would the economy look like if it was designed to work for women? This was the question asked by Women in the Economy (WE) – a research and action project based at the Aspen Institute Financial Security Program (Aspen FSP). The team – WE Founder and Aspen FSP Entrepreneur-in-Residence Heather McCulloch and Senior Research Partner Céline Apollon – took a deep dive into women’s economic lives to obtain their insights about the causes of their economic insecurity, what they see as the most promising solutions, and their vision for a gender-equitable economy. This report looked for answers in the wisdom, voices, and lived experience of working women, and the goal of the research was to lift up women workers’ voices and galvanize solutions that support women to strive, thrive, and reach their full potential. So basically, I love everything about this report! 

I highly encourage everyone reading this to dig into the 92 page powerpoint that delivers power-packed insights on the challenges that exist and what can be done from a policy and practice perspective. I had the opportunity to meet the researchers in December at the Gender Equity Summit: Women, Wealth and Power for the state of California, hosted by First Partner Jennifer Siebel Newsom, and the conversation was amazing. Bottom line, “the lack of support for working caregivers is hurting families, businesses, and our national economy”. This report provides a roadmap for awareness and action. 

Key Findings: 

• 4 out of 5 survey recipients felt they were economically insecure 
• 71% of women agreed that access to abortion services impacted their economic security
• Only 1 in 5 felt they had or could save enough for retirement 
• 90-100% of responses as to biggest challenges were the same across race and ethnicity
• Top three challenges were inflation, ability to make ends meet, and housing costs. 
• Flexible work and remote work opportunities were top solutions 

3. Diversity Matters Even More, McKinsey & Company, 2023.

McKinsey & Company is another one of my go to resources for research as it relates to advancing corporate diversity efforts, and women’s economic power more generally. Specifically, I have been following their research series that makes the business case for diversity in the corporate sector for almost ten years now, and their most recent entry is Diversity Matters Even More. It is the fourth report in a series investigating the business case for diversity, following Why Diversity Matters (2015), Delivering Through Diversity (2018), and Diversity Wins (2020). Through this series of reports, “McKinsey has delivered a comprehensive global perspective on the relationship between leadership diversity and company performance”. They argue that “this year, the business case is the strongest it has been since [they’ve] been tracking and, for the first time in some areas, equitable representation is in sight. Further, a striking new finding is that leadership diversity is also convincingly associated with holistic growth ambitions, greater social impact, and more satisfied workforces.”

Key Findings: 

• Companies with gender-diverse executive teams are 39% more likely to achieve financial outperformance.
• Top-quartile ethnic diversity on executive teams is associated with a 27% financial advantage.
• Companies excelling in both gender and ethnic diversity on executive teams are 9% more likely to outperform.
• Boards with gender and ethnic diversity are respectively 27% and 13% more likely to drive financial outperformance.
• One-fifth of executive team members globally are women, marking a 33% increase from 2020.
• Leading companies in the UK achieved 28% ethnic representation, surpassing the regional average, while U.S. companies reached 50% women on executive teams.

4. Capturing the Diversity Benefit: Workforce Diversity Linked to Financial Performance, As You Sow, 2023.

When it comes to diversity, equity, and inclusion initiatives in the workplace, to say that 2023 was a challenging year would be an understatement. In light of the current environment, there have been a number of studies that aim to continue to make the case that there is a business and economic case for focused diversity efforts, and this report is one of them. It was published by As You Sow, the nation’s non-profit leader in shareholder advocacy with a 30-year track record promoting environmental and social corporate responsibility, as well as advancing values-aligned investing. 

From the report: “Numerous studies have supported an assertion that companies do benefit from more racial, ethnic, and gender diversity. Diversity has been linked with cultivating more creative and innovative workplaces. Individuals from different backgrounds with varying expertise, lived experience, and knowledge allow companies to access a wider range of skills and consider risk differently when addressing complex challenges. This report analyzes the relationships between workforce diversity and financial performance through the review of this newly available dataset. In particular, we examine how this relationship has changed over time. Attention is paid to 2020, when a cultural shift in attention to race and equity issues took place in America, including a significant shift in corporate attention to racism and its harms.”

Key Findings: 

• Diversity benefit evident: Higher BIPOC (non-White) management correlates positively with enterprise value growth rate, free cash flow per share, income after tax, long-term growth mean, 10-year price change, mean return on equity (ROE), return on invested capital (ROIC), and 10-year total revenue compound annual growth rate (CAGR).
• Companies with large market capitalizations displayed a clear and statistically significant positive relationship with diverse management.
• Workforce diversity increased sharply in 2020. Brokers’ projections for companies with diverse managers also shifted to be more positive during this time.
• Increases in female leadership were positive and significantly correlated with increases in mean free cash flow per share, income after tax, income after tax 3- and 5-year CAGR, profit margin net, ROIC, and total revenue 10-year CAGR, though there were negative correlations with share price over 3, 5, and 10 years.

5. Diversity, Equity and Inclusion in the Workplace, Pew Research Center, 2023.

Similar to the previous report, this study is in response to the current climate around DEI efforts, wherein workplace DEI efforts are increasingly becoming part of national political debates. This nationally representative survey of 5,902 U.S. workers, including 4,744 who are not self-employed, was conducted Feb. 6-12, 2023 using the Center’s American Trends Panel. Interestingly, a majority of employed U.S. adults (56%) say focusing on increasing DEI at work is a good thing, but opinions about DEI vary considerably along demographic and political lines.

Key Findings: 

• 56% of U.S. workers believe that focusing on DEI at work is a good thing, 28% are neutral, and 16% consider it a bad thing.
• Importance of workplace diversity: 32% emphasize a mix of employees from different races and ethnicities, 28% prioritize diverse age groups, 26% value an equal mix of men and women, and 18% highlight the importance of a mix of employees with different sexual orientations.
• 36% believe being a man makes success easier (6% harder), 28% think being a woman makes success harder (11% easier), and 51% of Black workers feel being Black makes success harder.
• Democrats are more likely to perceive the impact of DEI measures positively compared to Republicans

6. Fidelity Investments® Study: Women Tapping Into Their Financial Superpowers to Gain Ground with Their Money, 2023.

Fidelity Investments has always been open about their commitment to advancing women’s financial wellness, and I have highlighted many of their reports over the years. Their most recent study underscores a significant increase in new women customers in 2023, particularly led by younger generations. It notes how women are actively engaging in the stock market with a thoughtful approach to market fluctuations, and that while there has been progress with regards to saving for retirement, women still face challenges, including caregiving responsibilities and healthcare costs. Fidelity is trying to address these challenges by providing a dedicated website, free consultations, and the growing Women Talk Money community as part of their efforts to support women in financial planning. Their Women’s History Month Event Series further amplifies their commitment to providing resources and fostering financial education for women, and reinforcing their role as advocates for women on their wealth-building journey.

Key Findings: 

• Fidelity added 48% more new women customers in 2023 compared to 2019.
• Younger women lead the way with 99% more new Gen Z women customers and 48% more new Millennial women.
• 60% of women are actively investing in the stock market, 51% of those women typically stay the course on their investments during market dips, compared to 43% of men.
• A 21% year-over-year increase among women opening Roth IRA accounts in the first eight months of 2023.
• Top financial stressors for women include: saving for retirement, preparing for health care expenses in retirement, dealing with caregiving responsibilities.
• Almost 1 in 4 women caregivers (22%) report not saving as much for retirement due to caregiving responsibilities, with 24% of Millennial women and 28% of Gen X women facing this issue.
• Nearly 6 in 10 women overall don’t think they’re on track with retirement savings.

7. Nasdaq with GOBankingRates: What Is the State of Women & Money in 2023? 

In 2023, women achieved notable progress in personal finance and careers, with single women owning more homes than single men, and over 10% of Fortune 500 companies having women CEOs. Despite these strides, the gender pay gap and lower participation in investing by women are continuing challenges. GOBankingRates’ recent survey indicates a shift in women's financial priorities, from saving for the future to meeting immediate needs, with covering basic expenses as the primary goal for many. Challenges include a perceived lack of money, ongoing inflation, and everyday expenses all causing financial stress. 

The survey shows that 57% of women are not actively investing, with a third citing a lack of funds as the main deterrent. Additionally, women's career satisfaction is hindered by perceived lack of opportunities, caregiving responsibilities, pay disparities, and gender discrimination. Despite considering themselves good with money, 53% of women don't feel financially stable, and common financial regrets include credit card debt and neglecting to build an emergency fund. Also of note, while women often lead household financial decisions, some still express reluctance due to fear or lack of confidence.

Key Findings: 

• Financial Priorities Shift: The majority of women (26%) now prioritize covering basic expenses, whereas in 2022, the main focus was on saving for retirement (30%).
• 47% of women identify a shortage of funds as their primary obstacle to achieving financial goals, while 39% point to inflation or the inability to meet daily expenses as their main financial stressor.
• 57% of women are not actively investing, and 33% of those attribute it to a lack of money.
• Career challenges for women include a perceived lack of opportunities (34%), caregiving responsibilities or lack of affordable childcare (16%), pay disparities (12%), and gender discrimination (7%).
• 53% of women do not consider themselves bad with money, 53% also do not feel financially stable.
• Common financial regrets include taking on credit card debt (19%) and not building an emergency fund (17%).
• 60% of women consider themselves financially independent, while 29% avoid thinking about or dealing with their finances, and 21% are fearful of making financial decisions due to a lack of confidence.

8. “Our Secret Numbers: Women, Men, and the Taboo Nature of Financial Health” 

Wells Fargo and The Female Quotient partnered on this study that explores how societal norms and conditioning discourage women from discussing money, which limits their financial growth and investment opportunities. If there was one report from this grouping that makes the business case for SheMoney, this one is it. The findings underscore the importance of breaking the silence surrounding financial discussions in order to encourage women to more fully engage with their financial resources. Additionally, the research identifies differences in perceptions of financial opportunities across generations, as well as variations in financial confidence between men and women. The study encourages open conversations about money to promote financial well-being. Heck the Heck YES!!!!

Key Findings: 

• Men are significantly more likely to talk to a financial professional about their financial health compared to women (29% VS. 20%) while women are more likely to say they don’t talk to anyone about it (35% VS. 26%).
• 25% of surveyed adults have never shared financial details like savings, spending, and credit scores.
• 43% of women experience financial anxiety, compared to 29% of men.
• women express discomfort discussing finances, with over 40% stating a stressful relationship with money.
• Generational differences exist in perceptions of financial opportunities, variations in financial confidence between men and women, and differences in debt discussion comfort levels based on gender and career progression.
• The study advocates for breaking the silence surrounding financial matters to empower women in managing their finances.

9. 2023 Diverse Investor Study: Black, Hispanic and Latina women investors report increased investment knowledge - J.P. Morgan Wealth Management 

The 2023 Diverse Investor Study indicates a notable increase in confidence among Black, Hispanic, and Latina women investors regarding their investment knowledge. Motivated by the desire to build generational wealth and support family and friends, these women are maintaining consistent investment amounts across racial lines, while men tend to adopt a more risk-taking and active stance. Despite concerns about a potential recession, the study suggests that such worries do not significantly influence financial decisions. Overall, the findings emphasize the importance of understanding diverse investor needs, with J.P. Morgan implementing initiatives to provide resources and access to investing for Black, Hispanic, and Latinx communities with the goal of closing wealth and opportunity gaps. The study also acknowledges that ongoing efforts are needed to achieve investment equality across gender and race.

Key Findings: 

• 68% of Black women investors and 52% of Hispanic and Latina women investors reported increased confidence in their investing knowledge over the past five years.
• 68% of Black, Hispanic, and Latina women investors started investing to build generational wealth.
• 66% and 70% of Black, Hispanic, and Latina women investors, respectively, started investing to support their family and friends.
• 83% of women investors surveyed are investing the same amount or more in their brokerage accounts compared to the previous year, while 74% of men investors are more likely to describe their investing strategy as "risk-taking," and 35% as "active."

10. 2023 State of Women in Wealth Management Report, Carson Group 

This study by Carson Group highlights the persistent challenges faced by women in the financial services industry. Despite a decade of data tracking, gender diversity in Certified Financial Planner (CFP) professionals has only increased by 0.2% to reach 23.7% in 2023. The report, serving as a benchmarking study, goes beyond tracking progress to explore various facets of underrepresentation, and aims to identify opportunities for improvement and growth. 

The objective of this study was to uncover insights with regards to the hindering of women in the industry, and find better ways to empower and elevate them. It delves into the sentiments of both women and men financial services professionals on aspects like career choices, previous industry experiences, satisfaction with current positions, mentorship, the impact of company culture, and the essential elements of a positive culture. This report is number two in making the business case for SheMoney!

Key Findings: 

• Concerns about the underrepresentation of female advisors persist, with 68% of men and 92% of women considering it a significant problem.
• Gender diversity in financial services has seen minimal change over the past decade, with women making up only 23.7% of CFP professionals.
• The industry's gender makeup does not align with the broader U.S. population, where women constitute 50.4%.
• Women lack sponsors in financial services, and confusion between sponsorship and mentorship persists.
• Women continue to face challenges balancing domestic responsibilities with their professional roles, the “Second Shift”. 
• Challenges like the "Queen Bee Phenomenon," "old boys' club," and "bro culture" hinder women's inclusion and advancement.
• Gender biases endure, impacting client preferences and requiring female professionals to constantly prove themselves.
• Incidents of sexual harassment and assault have resurfaced post-pandemic, contributing to an unsafe work environment.
• Respondents recommend learning from inspiring figures, focusing on foundational knowledge, networking, understanding business models, and avoiding unsuitable roles. 

You made it. A lot to process. As always we welcome your feedback in the comment section here on LInkedIn. If you liked the newsletter, do me a favor, forward this on and invite people to subscribe. We are up to 160,000 direct subscribers to this newsletter, and my goal is be at 250,000 by the time of our summit in June. Reminder, sign up here to on our mailing list for the summit and be the first to know when tickets become available.

Happy Women's History Month. And, let's make history, together.

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