Focused on the North Star: Our Investment Theory of Change

Women, girls, and non-binary people are full of inherent power. But so many of the systems and institutions that shape our lives work against that power. They limit our voices and agency. They marginalize and minimize. They stand in the way of a more just and equal future for everyone. 

Across the three core pillars of our work—investments, grantmaking, and philanthropy—the Equality Fund is challenging assumptions of the past and rebuilding the systems we need for a better world. We’re demonstrating what a future built by feminists, for feminists can look like. 

This commitment is especially true—and especially challenging—in our work within the financial ecosystem: an intricate network of investment activity that includes capital, consumers, products, services, policies, and ideas. This ecosystem, which has historically served a small and powerful group, is deeply outdated. 

At its core, our investment program seeks to shift the financial ecosystem so that it better serves people and the planet. It is critical to our vision of sustainably shifting power and resources to women, girls, and non-binary people. It will support change (by helping to finance our grantmaking) and drive change (by influencing the financial ecosystem) at the same time. 

Change at this scale does not happen overnight. We still have much to learn, and we know we will make mistakes as we work to build something new. Through it all, we are committed to transparency and active learning, knowing that our work is deeply interconnected with many others in this complex ecosystem. 

Our Investment Theory of Change 

As one important step in this journey, we are excited to share the investment theory of change that guides our investment program. It is the result of months of deep collaboration and consultation and was approved by the Equality Fund Board of Directors in December 2021. We’ve heard loud and clear—from feminist movements and many others—that sharing this investment theory of change publicly is an important part of collective learning and accountability. We agree wholeheartedly, and we’re thrilled to share it in full here

The investment theory of change acts as a critical North Star for our investment program, including both our investments and our field-building work. It also serves as a communications and alignment tool, helping to convey our ambitions to external stakeholders and new partners, while ensuring our own teams have a powerful compass to guide and calibrate their work. 

Contributing to Transformation 

At its core, the investment theory of change addresses a central challenge: Financial markets have the potential to generate income for feminist movements, but entrenched power dynamics in how capital flows must be addressed—and ultimately disrupted—to realize this potential.

Therefore, the Equality Fund’s investment program envisions a transformation of how, where, by, and to whom capital is deployed to finance and advance global feminist change

To achieve this vision, the Equality Fund will work to increase understanding of the social and financial benefits of investing to advance global feminist change; and demonstrate the viability and impact of a multi-asset portfolio wholly invested according to gender-lens investing principles. 

We will also partner with peers and others to build and showcase products, mobilize capital, and ultimately transform power dynamics and increase collaboration and synergies between investors and investees, feminist movements, feminist economists, and policy influencers. 

Woven throughout the investment theory of change is the recognition that we are just one actor among many in a complicated ecosystem. We outline where we expect to lead, and where we will seek to partner with others to grow and evolve the field. It is abundantly clear that more collaboration, among many more players, is essential to transforming the field together. 

Collaboration in action 

We sought to model this kind of partnership as we developed the investment theory of change itself. Our process was highly collaborative, with roundtable conversations and extensive one-on-one consultations and meetings among diverse leaders—from feminist economists and movement leaders to traditional investment experts. 

We convened over thirty feminist movement leaders and gender-lens investing experts along with key Equality Fund stakeholders, including the Investment Advisory Council, a diverse and dynamic group of investors, feminist activists, and women’s rights advocates who help ensure that feminist perspectives are incorporated across our investment activities; our Investment Committee; our Outsourced Chief Investment Officer, RockCreek; our partners at Toronto Foundation and Equality Fund staff. 

The process was managed by a committed and talented team at Dalberg, who was selected after a competitive RFP process. 

Taking flight 

The investment theory of change was developed as the Equality Fund itself was taking flight. It is worth noting that the Equality Fund is doing even more work, guided by input from diverse feminist movement leaders, to fully illuminate the rich meaning of “feminist change” cited in the investment theory of change. A process to articulate the core values of the Equality Fund, as well as an overarching organization-wide theory of change to guide our work as a whole, are also underway. 

The results of all of this work will be fully integrated into the investment theory of change in future iterations.

Looking ahead 

The investment theory of change is one in a series of core tools that outlines and implements our vision for the Equality Fund’s investment program. Together they will serve as a foundation for our work moving forward. 

These critical tools are interconnected and will be completed in the following order:

  • Investment theory of change; 
  • Intersectional investment guidelines, a set of guidelines that build from the investment theory of change and lay out the high-level framework to guide considerations for Equality Fund investments; and 
  • Gender-lens criteria, specific screening criteria for Equality Fund investments in private markets. 

Now that we have completed the first iteration of the investment theory of change, we will focus on developing the second and third tools above. We expect to complete these in the first half of 2022. 

With gratitude 

Like so much of what we are doing at the Equality Fund, this work has no easy roadmap. It is a challenge to the status quo—a shared commitment to reimagine what has come before us in order to build a more equitable path forward. It is only possible because of collaboration, diverse input, fresh thinking, and collective imagination. 

We thank each and every person who contributed to the powerful theory of change that is its result. From our partners at Dalberg, RockCreek and Toronto Foundation, to our many roundtable participants and deep listeners, to the Investment Advisory Council, Investment Committee, and Equality Fund board, each of our powerful collaborators made this breakthrough possible, and we are grateful to all of you. We also thank the many Equality Fund staff members whose work and wisdom guided this process from start to finish. 

United in uncompromising values—and guided by a clear north star—we believe that our investment program can contribute to a more just and joyful future for women, girls, and non-binary people everywhere. We are excited to take this work forward together in the years ahead. 

Read this article in Spanish here.

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