The future of women in sustainable finance

Sustainable finance is innovating rapidly. What does this mean for women in the sector and the wider industry?

In Part 1 of this series, How sustainable finance found its gender balance, we looked at the current gender diversity landscape and asked women working in sustainable finance asset management why they thought it was more gender-balanced than traditional finance.

Now, we share their views on the future of this space, as sustainable finance attracts a high degree of interest because of its more recent association with influence, profit and career prospects, as well as the rise of technology and data focused roles.

Will sustainable finance lead the way in gender diversity?

Some of our interviewees believe that the gender balanced sustainable space will set an example bringing more women and sustainability into the wider industry. However, others are concerned that sustainable finance could become the only option for women advancing their careers in the finance industry.

We need to make sure we don’t end up with women only in sustainable finance. We need women in all parts of finance. I think that will also help us make all parts of finance more sustainable.

Jane Ambachtsheer, Global Head of Sustainability, BNP Paribas Asset Management


Growing interest in sustainable finance means job demand in this sector will rise. We decided to dig deeper and look at what this trend means for sustainable finance and what candidate profiles will look like in coming years.

STEM could shift gender balance in sustainable finance either way

With the rise of science-based targets embedded in sustainable solutions, STEM (Science, Technology, Engineering and Mathematics)-related skills are becoming increasingly coveted in sustainable finance jobs. Interestingly, these disciplines have traditionally been male dominated, and this is already tilting the gender balance in sustainable finance.

One of our interviewees observed that there were more men managing the kind of harder data related to ESG and more women looking at social issues.

That could be because only 3% of students joining information and communication technology (ICT) courses across the globe are women, 5% for mathematics and statistics courses, and 8% for engineering, manufacturing and construction courses according to the World Economic Forum.

This trend raises concerns that it would create a double hurdle for women to gain a foothold in the sector: women would have to bridge the gender gaps that exist in STEM education before going on to face them in the workplace. On the other hand, this could shift the balance the other way around, pushing more women in STEM education to access sustainable finance.

The STEM world has and still suffers from gender imbalance but coupled with sustainability it could be an opportunity to bring gender-balance into the tech space.

Delphine Queniart, Global Head of Sustainable Finance and Solutions for Global Markets at BNP Paribas

While the primary focus of our research was to reflect on women’s roles within sustainable finance, the skills-based gender discussion led us to reflect on the impact sustainable finance has on women.

Can sustainable finance help gender balance in finance?

Our interviewees unanimously agreed that progress in sustainability so far predominantly addresses environmental issues rather than social ones. Research also shows that addressing environmental issues can have a positive direct or indirect impact on social issues: there are real interdependencies between climate and gender issues.

Climate issues have very broad societal implications and drivers like when you think about Bangladesh being flooded every year a big proportion of the casualties, they are women, and that’s because they stay at home … Addressing climate issues is also going to address gender issues.

Salima Lamdouar, Fixed Income, VP/Sustainable Strategies, Alliance Bernstein

The poorest and most disadvantaged groups tend to depend on climate-sensitive livelihoods (e.g. agriculture), which makes them disproportionately vulnerable to climate change, according to a report from the United Nations Development Programme. (source) According to the same UN report, given that women earn between 30 and 80% of what men earn annually, they are more likely to face poverty, leaving them more exposed to climate change risks.

Looking ahead, social issues will continue to increase in importance. However, “green issues” will remain the first issue to tackle. I hope that people realise that there are interdependencies, and we have to take into account both environmental and social issues at the same time because they feed into each other.

Marie Fromaget, ESG Analyst, AXA Investment Managers

Microfinance has been a type of sustainable finance with a direct impact on gender equality which has encouraged women entrepreneurs: women represent 74% of microfinance borrowers. For example, over more than 30 years, BNP Paribas, through microfinance, has helped more than 1.8 million women across the world.

Busting the myths of gender inequality

Unlike the “E” (Environmental) in sustainable finance products, tracking and measuring gender equality is not so easy. Therefore, because gender outcomes might be perceived as harder to measure or quantify, they could be neglected.

Integration of social factors into business models is gaining pace. Gender equality isn’t an exception where we see an increasing reporting in gender balance at managerial levels. Yet, to create a long-term prosperous environment for all stakeholders the companies should set in place the right policies, covering for instance equal development opportunities, anti-harassment and non-discrimination laws. The structure of such policies still greatly differ among market participants, making it difficult to assess their effectives.

Jovita Razauskaite, Portfolio Manager Green Bonds, Specialised Fixed Income, NN Investment Partners

There are to date few examples of financial instruments embedding social key performance indicators (KPIs) like gender equality.

Recent transactions are showing that sustainable finance can be an effective tool to help push the gender equality agenda:

The world’s first sustainability-linked convertible bond from Schneider Electric in November 2020 included a KPI specifically linked to increase gender diversity: 50% of hires to be women, 40% women among front-line managers, 30% women in leadership teams by 2025.

In February 2021, The Carlyle Group issued their first sustainability-linked loan uniquely tied to board diversity. Carlyle chose this KPI based on an in-depth analysis of their portfolio: on average, the earnings of their owned companies that have diverse board members have been about 12% higher than others.

Carlyle’s analysis is further backed by a Harvard University research that demonstrated the positive correlation between diversity and performance as gender-diverse groups perform better in terms of sales and profits.

Some investors will try to move the dial in a more direct manner, through proxy voting policies for instance.

Our proxy voting policy sets a baseline expectation that boards of directors should be 30% female in developed markets, and 15% in emerging markets. This sends a direct signal to companies and their boards that we are unhappy with companies that can’t demonstrate minimum levels of diversity at the board level.

Jane Ambachtsheer, Global Head of Sustainability, BNP Paribas Asset Management

Another example is major hedge funds in Asia searching for diversification – in their teams as well as their investment portfolios, recognising the important role of governance in gender diversity (the G in ESG).

Supranationals are also particularly involved in this field, and keen to support gender diversity in emerging countries where climate change and gender-equality are often interdependent issues.

When you’re funding many of the supranationals, like the World Bank, or the IFC or the ADB, a lot of that funding goes into gender oriented development projects. So there is that element that is tied in very closely with sustainable finance.

Lupin Rahman, Head of EM Sovereign Credit, PIMCO


Predominantly focused on environmental issues, the sector is thus progressively addressing indirectly and directly the issue of gender equality.

As the workforce itself is changing, we also see the wider impact of sustainable finance shifting: environmental issues are intertwined with women’s fate and gender-equality is slowly becoming a priority for corporates and institutions to integrate into their sustainability agenda.

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