Feminist, for-profit development models are not a radical venture

Opinion: Here’s how development spending can work effectively with the financial system for mutual benefit.

Jess Tomlin, CEO of the Equality Fund

For decades, development spending has been falsely sold to voters as purely charitable. This is a story that has not only made it politically fragile, but also ensured that vast, untapped value has been left on the table. That framing no longer fits reality.

This week, the U.K. government hosts the Global Partnerships Conference in London — gathering ministers, NGOs, and investors to discuss where next for global development. It comes at a moment of painful retrenchment, as aid budgets shrink across the donor countries and governments redirect spending toward defense and domestic priorities.

In this climate, development institutions are under growing pressure to show that development spending is not only morally important, but economically and strategically smart. That means confronting an uncomfortable assumption embedded across much of the sector: That “for-profit” and “development” are somehow inherently at odds.

Development spending is an economic strategy

Treating all development spending as a sunk cost is simply economic naivety. Well-designed development investment can do something far more interesting than tick an ESG box — it can generate real, measurable returns for both public donors and private investors.

Structured properly, it becomes a vehicle that grows portfolios while also strengthening partner economies and stabilizing regions.

Yet despite this truth, there is a persistent discomfort with the idea that strategies that are effective in generating wealth in other spaces can be harnessed to do the same in the service of critical development objectives. Public and political reactions to “for-profit” models are often skeptical, assuming that profit and impact are fundamentally at odds.

As a result, money that could be structured to work differently is instead constrained, siloed, or dismissed altogether.

Nowhere is that missed opportunity clearer than in resourcing gender equality. For over a decade, the International Monetary Fund has highlighted gender equality as “macro critical,” with large gender gaps in labor force participation holding back growth and weakening financial stability. Its analysis suggests that closing those gaps could raise gross domestic product by around a third in some economies. Leaving women out of the economy is therefore one of the most expensive policy mistakes of our time.

At the Equality Fund, we decided to test this premise: that development money can be structured into an investment fund, generating returns that can sustainably fund women’s rights organizations and movements, which are essential infrastructure for delivering transformative change. The model is deliberately multipronged: investment capital is used to shift markets and back businesses that advance gender equality, while the returns help provide flexible, multiyear grant funding to the organizations closest to the work.

There is still a lingering and uncomfortable question. If the economics are so strong, why is so little capital organized this way?

The problem is not a lack of ideas but an outdated financial architecture. Risk models and reporting systems still treat gender equality and women-focused investments as niche, risky, or concessionary. Women-led funds and women-owned enterprises often face higher collateral requirements than comparable investments, despite evidence that portfolios with more women borrowers and leaders frequently perform as well or better.

Collectively, we have the opportunity to reform

A shift in the financial ecosystem may sound bold, but the opportunities it provides are too beneficial to ignore. It has the potential to activate the full continuum of financial capital, build full-scale investment, and invest in key growth markets that accelerate equality outcomes.

If governments and investors want to finance gender equality at the scale it demands, they need to stop treating it as an add-on and start treating it as a core investment principle. Gender analysis should shape aid, lending, and portfolio decisions, backed by transparent data on where capital goes, who benefits, and what outcomes are being achieved.

Public money should be truly catalytic. It should take the first risk, prove what works, and crowd in private capital. Development banks and finance institutions should strip out unjustified risk premiums on women-focused portfolios and use their capital to unlock more financing, not replace it.

This is also a test of political leadership. Governments also have to use their market power to make gender equality the norm, embedding it in financial mandates and demanding clear reporting. Investors and philanthropic institutions should align their screens, benchmarks, and funding with gender-equality outcomes.

The challenge is not a lack of rhetoric. It is a lack of discipline. If the goal is to future-proof financing for gender equality, the answer is simple: allocate capital with intent, price risk properly, and direct more flexible, predictable, long-term money to the women’s rights organizations and feminist funds that are already doing the work.

Canada, Germany, and the United Kingdom have already shown how political choices can begin to reshape incentives. Canada’s Feminist International Assistance Policy directs that almost all bilateral development assistance should integrate gender equality and has backed that promise with anchor capital for vehicles such as the Equality Fund. Germany’s January Reform Plan outlined that its development policy will remain a feminist one — championing the rights of women, girls, and marginalized populations in their equal access to resources and representation. And in March, the U.K. government pledged that by 2030, at least 90% of its aid programs will integrate gender equality, not as an afterthought, but as a core part of how money is spent.

While a significant step forward, governments, philanthropy, and multilateral institutions must go even further: embedding gender criteria across all portfolios, using their capital to enable innovative and blended finance models, and providing support to women’s rights organizations as critical infrastructure to ensure safe and stable conditions for communities, and therefore economies, to thrive.

Meeting the moment

Development spending is going to remain under pressure as private and public donors feel the squeeze, with global volatility putting additional constraints on already-stretched aid budgets, and we cannot afford to leave money, growth, and security on the table. The opportunity for transformational change has therefore never been more real.

Faced with this reality, development must not play in the margins of the financial architecture. Protecting hard-won gains and breaking new ground can only be achieved through creatively deploying capital across the financial system and investing in the financial levers that build resilience.

Feminist, for-profit development models such as the Equality Fund are not a radical departure from prudence; they are what prudence looks like when every dollar works harder, and works for everyone.

This article was written for and published on Devex, 20 May 2026. Find the original article here.