New 2X Challenge announces US$20 billion target for investments for women

This article is published in association with European Investment Bank.

A multilateral coalition of public and private sector investors yesterday pledged to invest US$20 billion in women’s economic empowerment over the next three years, under the 2X Challenge.

The announcement came at the close of the G7 Leaders’ Summit in Italy, with the official communique affirming support from among the grouping’s development and multilateral finance institutions:

“Recognising the success of the 2X Challenge, we welcome the new collective commitment by our Development and Multilateral Finance Institutions and other members of 2X Global, to invest at least USD 20 billion in gender lens investing in developing countries, encouraging investments at the nexus of gender and climate finance.

We call upon other public and private actors to join the next three-year 2X Challenge, advancing measurable changes and financing directed to women’s empowerment.”

This will be the third edition of the 2X Challenge, which was first launched at the G7 Summit 2018 in Canada, as a commitment from the G7 development finance institutions (DFIs) to mobilise US$3 bn in gender lens investments between 2018 to 2020.

The first Challenge significantly surpassed that target, raising more than US$11 bn. A new target of US$15 bn was set at the G7 Summit 2021 in the United Kingdom and was also subsequently surpassed with US$16.3 bn raised between 2021 to 2022. As of 2024, more than US$33.6 bn in gender lens investments have been mobilised under the 2X Challenge.

The 2X Challenge 2024-2027 marks the first time that private investors will be a part of the initiative, which has expanded to include the full spectrum of capital providers.

Seven private sector participants have already committed to the 2X Challenge – they are: Deetken Impact, the Global Innovation Fund, I&P Investisseurs & Partenaires, Developing World Markets (DWM), Advance Global Capital, Global Gender-Smart Fund (GGSF), run by Innpact and Sarona Asset Management.

Jessica Espinoza, Chief Executive Officer of 2X Global, the independent organisation which runs the Challenge, hailed this new phase in the initiative: “This is really a significant milestone in the journey of the 2X Challenge – something which we’ve hoped for and worked towards making a reality. Having both public and private capital providers on board for the Challenge represents an extraordinary opportunity to mobilise even more gender-smart capital for women, unlocking their potential and driving economic growth. Combining the resources and expertise from both the public and private sectors means we can amplify our impact as we strive to close the gender gap in finance.”

EIB Group President Nadia Calviñosaid: “The 2X Challenge’s success proves the power of gender-smart investing in building a fairer and more prosperous society for all. I’m proud that the European Investment Bank Group led the way as the first Multilateral Development Bank to adopt these criteria.  It’s inspiring to see other, especially now private partners too, follow suit. With our new ambitious target, I look forward to driving more investments that empower women and promote gender equality.”

A range of DFIs and MDBs have pledged their support for the 2X Challenge 2024-2027. They are:

• Asian Development Bank
• British International Investment (United Kingdom)
• Belgian Investment Company for Developing countries (Belgium)
• CDP Development Finance (Italy)
• DEG – Deutsche Investitions- Und Entwicklungsgesellschaft (Germany)
• U.S. International Development Finance Corporation (United States)
• European Investment Bank – EIB
•  FinDev Canada (Canada)
• Finnfund (Finland)
• FMO Entrepreneurial Development Bank (Netherlands)
• International Finance Corporation
• Investment Fund for Developing Countries (Denmark)
• Japan Bank for International Cooperation (Japan)
• Japan International Cooperation Agency (Japan)
• Norfund (Norway)
• Development Bank of Austria – OeEB (Austria)
• Proparco (France) and;
• Swedfund (Sweden)
• Swiss Investment Fund for Emerging Markets (SIFEM)

Under the 2X Challenge, investments are qualified using the 2X Criteria, the framework which underpins the Challenge and which has become widely used as the global industry standard for GLI. Participating investors submit their qualified gender lens investments through the Challenge platform, powered by Equilo.

The Case for Investing in Women

• If women and men were to simply participate equally as entrepreneurs, global GDP could rise by 3-6%, boosting the world economy by US $2.5-5 trillion.
• The European Investment Bank estimates that greater gender diversity in the workforce could lead to a potential increase of 26% of annual global GDP and US $160 trillion of human capital wealth, and could enhance business performance by 15%.
• Over 10 years of investing, companies with a female founder performed 63% better than those with all-male founding teams.
• In a study of Russell 1000 companies, Glenmede Investment Management found that firms with greater gender diversity (defined as: female CEO or Chair; greater than 20% women on the board; and greater than 25% women in management) outperformed with greater return and less risk.

Background information

The European Investment Bank (ElB) is the long-term lending institution of the European Union, owned by its Member States. It finances sound investments that contribute to EU policy objectives. EIB projects bolster competitiveness, drive innovation, promote sustainable development, enhance social and territorial cohesion, and support a just and swift transition to climate neutrality.

The EIB Group aims to embed gender equality and in particular women’s economic empowerment in its business model and is also committed to driving gender equality in its workplace. The EIB financed a total of 63 projects across the globe in 2023 that significantly contributed to gender equality and women’s economic empowerment, providing €5.8 billion of investment, more than half of which also supported climate action.

About 2X Global

2X Global is a membership and field-building organisation focused on unlocking gender-smart capital at scale. We engage the full spectrum of investment actors, capital providers, and intermediaries working in public and private markets, across both developed and emerging economies towards this mission. Through a broad and diverse set of activities we activate and engage our global community to advance intersectional investment agendas, scale the field, shift mindsets, and facilitate capital deployment.

About the 2X Challenge

The 2X Challenge was founded by the G7 Development Finance Institutions as a call to action to shift more capital towards investments that empower women in developing countries to access entrepreneurship and leadership opportunities, quality jobs, and products and services that enhance their economic participation.