Women and girls face inequality in many aspects of their lives, globally disproportionately living in poverty and lacking access to education, employment, opportunities, and finance. However, women are powerful agents of change and solution-makers to chronic underinvestment in social protection, care, health, education, nature restoration, climate resilience and adaptation. They are financial decision-makers, asset accumulators, employees, and business owners, in both the formal and informal economy.
Financial institutions are important stakeholders in the collective mission to address gender inequality. They hold significant influence over the gender-power dynamics within the system and are themselves affected by these dynamics. By setting clear and specific targets for the advancement of gender equality and aligning their portfolios with international and national gender frameworks, financial institutions can contribute to the achievement of several UN Sustainable Development Goals including but not restricted to Goal 5 “Achieving gender equality and empowering all women and girls”. Incorporating gender consideration into their business practice will also demonstrate institutions’ commitment to a sustainable future, attracting socially responsible investors and fostering long-term partnerships.
A core part of UNEP FI’s work on social and human rights is to provide guidance and assistance to members on identifying gender indicators and meeting gender targets. The Principles for Responsible Banking’s Guidance on Gender Equality Target Setting provides practical examples of how to set targets in retail banking and measures for banks to ensure that gender-sensitive practices and processes are embedded within their organisation.
Incorporating gender equality considerations into banking practices
In 2023, UNEP FI and UN Women developed a three-pillar approach supporting banks working towards achieving gender equality both inside and outside their organisation. The three main pillars are:
- Gender responsiveness: banks are gender-responsive and compliant with internationally agreed norms and standards, captured in principles, such as the .
- Portfolio shift: banks portfolios have been shifted to:
- Increase investment and loans for gender-responsive businesses and projects that specifically target gender equality or disproportionally benefit women.
- Avoid financing projects including gender risks through careful and systematic analysis and understanding of potential gender risks in portfolio.
- Financial health and inclusion of women: There is equality in access to and use of financial products and services and women are empowered to become more financially resilient, while women-owned or led businesses are supported in increasing their financial soundness to become sustainable successful businesses. Read more on financial health and inclusion here.