By Tiphanie Sage
Simone de Beauvoir "One is not born, but rather becomes, a woman”
Simone de Beauvoir’s quote shines a light on how women’s roles have historically been shaped by societal expectations. Becoming a woman once meant conforming to specific behaviors and fitting predetermined roles to secure a place in the societal structure. It was not—and, to some extent, still is not—a mere biological fact. In 2025, while we’ve moved past many stereotypes, the topic remains critical. Women have made significant strides in traditionally male-dominated fields like finance, but barriers persist.
Gradually, women have risen into leadership roles, defying the remnants of the “boys’ club” mentality. Simultaneously, Environmental, Social, and Governance (ESG) factors have gained prominence in financial decision-making. As responsible and inclusive approaches to business practices, investments and decision-making continue to gain prominence, supporting women in finance plays a crucial role in advancing ESG goals and promoting long-term sustainability. For instance, The European Union, the United Nations Principles for Responsible Investment, and the United Nations Environment Program have all made significant strides in integrating ESG into financial systems.
At first glance, women and sustainability may not seem inherently linked. However, studies show that women, who are 14 times more likely than men to be killed or injured during climate-related natural disasters due to their increased exposure to climate risks (UN&UNDP), often take active roles in addressing environmental issues. For instance, women earn between 30–80% of men's wages and represent 70% of the 1.3 billion people living in poverty, which makes them more vulnerable to climate change impacts. This heightened vulnerability has positioned them as leaders in sustainability initiatives, reinforcing their critical role in driving sustainable finance.
Persistent Challenges for Women in Finance
Despite progress, women remain underrepresented in executive finance roles. Gender biases and stereotypes regarding women’s financial capabilities still create obstacles such unequal access to networking opportunities, mentorship, and leadership positions. While progress has been made in gender equality, challenges persist. For instance, less than 1% of Official Development Assistance (ODA) funding is directed towards women’s rights organizations working towards Sustainable Development Goal 5 (SDG 5), which aims to achieve gender equality and empower women and girls.
Additionally, geopolitical and environmental crises, such as the COVID-19 pandemic and the climate emergency, have stalled and eroded hard-won gains in gender equality. For example, despite the pandemic, 2020 saw a record $600 billion in green, social, and sustainability-linked bonds being issued, yet only 1% of these were aligned with SDG 5(1). Moreover, there is a significant financing gap: an extra $360 billion annually is needed to achieve gender equality and women’s empowerment in developing nations.
Integrating gender equality into green finance presents a powerful, yet underutilized, opportunity to address the persistent challenges women face while advancing global sustainability goals. Research highlights that gender-diverse corporate boards enhance environmental management systems and improve corporate performance, demonstrating the tangible benefits of inclusivity. Empowering women through financial literacy initiatives has also proven transformative, equipping them with the tools to drive sustainable entrepreneurship in green sectors. Programs like India’s Solar Mamas exemplify this potential by training women in energy technologies, simultaneously fostering gender equality and sustainable development.
However, systemic barriers persist. Limited access to green financing tools and exclusion from key decision-making roles often prevent women from fully contributing to and benefiting from these initiatives. This underrepresentation stifles innovation and restricts progress in creating equitable and sustainable solutions.
Women’s contributions to sustainable practices, from green entrepreneurship to adopting low-carbon lifestyles, are frequently undervalued. Inclusive policies such as gender-responsive budgeting, successfully implemented in regions like the European Union and Taiwan, demonstrate the profound potential of aligning financial strategies with gender equality. By addressing these barriers and fostering collaboration across sectors, gender-sensitive green finance can become a cornerstone for achieving the Sustainable Development Goals (SDGs), driving both social equity and environmental resilience forward.
The case of women-Led Startups and the Funding Gap
Addressing these systemic challenges requires targeted efforts, particularly in supporting women-led startups, which face significant funding gaps despite consistently outperforming male-led ventures in financial and social impact. As sustainable finance seeks to allocate resources to ventures that not only generate financial returns but also deliver social and environmental benefits, it can play a crucial role in supporting women-founded businesses. By incorporating gender equality into the environmental, social, and governance (ESG) criteria, investors can prioritize funding for women-led companies. Women-led startups face a stark funding disparity, as they receive significantly less investment than their male counterparts, with an average gap of over $1 million. Yet, women-founded companies consistently outperform male-led businesses in revenue, generating more than twice the revenue per dollar invested.
While progress has been made in gender equality, challenges persist in securing funding for women entrepreneurs. A partnership between BCG and MassChallenge revealed a clear gender gap in startup funding. Women-led startups received an average of $935,000, compared to $2.1 million for male-led startups. Despite receiving less funding, women-founded startups generated 78 cents per dollar invested, compared to 31 cents for male-founded ventures. Moreover, companies with women founders generated 10% more revenue over a five-year period, with cumulative earnings of $730,000 compared to $662,000 from male-founded startups. This data highlights not only the disparity in funding but also the stronger financial returns of women-led companies, emphasizing the need for a more equitable investment approach.
Women founders face assumptions of being less knowledgeable or providing overly conservative projections, while male investors may lack understanding of female- driven products. This issue can be tackled with the following recommendations:
o VC Firms and Investors: Need to be aware of structural biases and consider realistic projections in pitches, as well as include more women in investment decisions.
o Startup Accelerators: Should actively recruit women entrepreneurs, provide resources, and connect them to women-friendly investors and networks.
o Women Entrepreneurs: Should use data to reshape their pitch strategies, seek out mentors, and target VC firms with strong records of investing in women-led companies.
Innovative Solutions and Policies
The previous paragraph prompts the need for innovative solutions to solve complex issues like gender inequality and sustainability. Some solutions already in place include mandatory quotas and programs promoting female leadership, such as Norway's 40% female board requirement, which has led to more women in top roles influencing sustainability efforts. Initiatives like NatWest Group’s support for female entrepreneurs showcase how empowering women fosters positive change. These initiatives align with broader efforts to encourage women’s participation in sustainable finance, where educational programs and scholarships for women in ESG and finance are becoming increasingly important. In 2021, organizations like Chief Executive Women, in collaboration with Australian and New Zealand Bank, launched scholarships specifically designed for women with leadership experience in ESG, providing them the tools and resources needed to take on more significant roles in the sector.
Cross-sector partnerships, such as those led by the UN, support women’s involvement in sustainability projects, which is especially important as women, particularly in vulnerable regions, face disproportionate risks from climate change—women are 14 times more likely to be affected by climate-related natural disasters. Therefore, increasing women’s representation in sustainable finance decision-making is not just a gender issue, but a moral and economic imperative. Women are underrepresented in sectors like clean energy, making up only 32% of the global workforce, and expanding their opportunities is crucial for more inclusive, resilient financial systems.
Encouraging more women to pursue STEM disciplines will also ensure that the next generation of leaders is equipped with the skills necessary to innovate and drive sustainability forward. In sum, building a gender-balanced workforce in sustainable finance is not just about fairness—it’s about creating a future where financial systems and sustainability are better equipped to tackle the challenges ahead.
Sustainable Finance as a Catalyst for Gender Equality
Sustainable finance has the potential to be a powerful driver of gender equality by ensuring that financial resources are directed towards projects that empower women and girls. By incorporating gender considerations into financial decisions, sustainable finance helps bridge the gap in areas like economic and social equality. For instance, countries like Iceland have issued gender bonds to directly fund initiatives that promote women’s economic empowerment, setting an example for others to follow. Similarly, nations such as Colombia and Egypt are raising sovereign debt to support gender equality projects, with backing from UN Women.
While progress is being made, there is still a significant funding gap. Currently, less than one percent of official development funds go to women’s rights organizations. This is where sustainable finance steps in, offering an innovative way to secure the resources needed for gender equality. Global initiatives like the Addis Ababa Action Agenda and the rise of green, social, and sustainability-linked bonds further highlight how sustainable finance can make a real impact. By channeling investments into gender-inclusive projects, sustainable finance not only helps tackle inequality but also lays the groundwork for a future where women and girls have equal opportunities to thrive.
Conclusion
These elements collectively show how women are not only shaping the future of sustainable finance but also how societal frameworks around gender need to evolve, aligning with de Beauvoir's idea that gender roles are not innate but constructed and subject to change. Sustainable finance stands as a transformative tool for achieving gender equality, requiring a conscious effort to raise awareness and direct financial resources toward SDG 5. However, the main challenges lie in avoiding superficial approaches that fail to bring about systemic change and the risk of commodifying feminist ideals without tackling underlying structural inequalities. To make real progress, there must be more investment in gender equality through sustainable finance, ensuring that it addresses the root causes of gender disparity.
(1) SDG5: SDG 5 is Sustainable Development Goal 5, which aims to achieve gender equality and empower all women and girls. This goal focuses on eliminating discrimination, violence, and harmful practices, ensuring equal participation in leadership, and providing equal access to education, healthcare, and economic opportunities for women and girls. The target is to promote and enforce policies that support gender equality and the empowerment of women in all aspects of society.
Footnotes
1. Abouzahr Katie (June, 2018)
2. Dr Wang Mingzhu (July, 2023) https://www.kcl.ac.uk/business/assets/research/thought-piece-women-in-sustainable-finance.pdf
3. (July, 2024) https://www.unwomen.org/en/articles/explainers/how-sustainable-finance-can-drive-gender-equality
4. Fu-Hsaun Chen (June, 2024) https://www.aimspress.com/article/doi/10.3934/GF.2024022? viewType=HTML&utm_source=chatgpt.com
5. Goh Frances (October, 2024)
6. Mureithi Carlos (January, 2025) https://www.theguardian.com/world/2025/jan/15/solar-mamas-empower-our-people-by-giving-them-electricity-the-women-lighting-up-zanzibar
About the Author
Tiphanie Sage
Tiphanie Sage is a Master’s student at EDHEC Business School, studying management — finance track. She is dedicated to women’s empowerment in finance and passionate about sports in her downtime. With an international upbringing and a dual-nationality background, she has developed a global perspective and the ability to navigate diverse environments, which she applies in her studies and professional experiences. She seeks to gain expertise in global markets, particularly in sales and trading, during her upcoming gap year.
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