ESG Investing

ESG Efforts toward Gender Equity Help Boost Representation for Women in STEM

Enduring obstacles have exacerbated many of the already long-standing gender gaps affecting women in STEM education and training, technology workplaces, and venture funding.

Despite programming’s origin as a woman-dominated field, the share of bachelor’s degrees women earned in computer science declined from 27% in 1998 to 20% in 2018. In the workforce, women’s representation in computing and mathematical roles has remained at about 25% since 2007. Notably, women made up just 19% of software engineers in 2019.

Women who found technology-related startups face their own stubborn gap. Funding for sole female founders represented just 2.4% of all venture capital in 2020, down from a paltry peak of 3.4% in 2019.

These figures indicate a wider need for women-focused technology education, training, innovation, and investment. Yet narrowing these gaps in representation hinges on access to a stronger ecosystem of support overall—highlighting the efforts of organizations and ESG investors seeking impact in gender equity.

Championing Women in Tech

One route to a narrower gender divide is to support nonprofits working to bolster women in STEM education. Founded in 2011, Black Girls Code hosts workshops and school programs to empower girls of color with the skills to become leaders in STEM fields. The organization aims to offer one million girls training in technology-related fields by 2040.

Girls in Tech employs its global reach of more than 60,000 members spread across roughly 50 chapters to provide local workshops and boot camps aimed at supporting women in STEM fields. The nonprofit also operates startup training and pitch events through which more than 5,000 entrepreneurs have found funding and mentorship.

Laying the foundation for better female representation in technology goes beyond STEM education. Women 2.0 works with corporate partners to train women founders, connect founders with investors, and operate as a media hub spotlighting the achievements of women in STEM and tech.

Finding Support from Venture Capital

Venture capital (VC) investment firm Chloe Capital’s portfolio entirely comprises companies led by women, with 30% led by women of color. The organization provides multiple points of support, including entrepreneur education. Chloe invests in women-led technology companies at the seed stage—investees must tout at least one female founder with at least 20% equity in addition to having a product in the market with early revenue or strategic partnerships in place.

According Chloe Capital Managing Partner Elisa Miller-Out, “We are not a concessionary fund. We aim for superior returns because of our gender and diversity lens.” That goal has been borne out by their the firm’s success, debunking old myths around sacrificing returns for diversity.

Chloe partners with foundations and government entities to bring training and capital to entrepreneurs through events combining accelerators, competitions, mentors, and capital connections. The organization also runs programs meant to address common concerns such as childcare, where the consequences of a lack of resources disproportionately fall on women. In April 2021, the firm launched the Diversity in ClimateTech program with New York State and Cornell University.

“The beauty of the entrepreneur programs at Cornell is very early on-ramping for innovators. Early training, especially connecting with customers, is crucial,” Miller-Out states. The program’s environmental justice lens drives it to assist entrepreneurs in areas spanning agriculture tech, sustainable building materials, and clean energy and transportation.

With partner investors, the program will help guide companies from the early through growth stages of VC investing. “We are looking toward moving more institutional capital into this ecosystem,” Miller-Out says. “We believe that larger institutional pools will be required to move the dial on investing in diverse founders. We look forward to supporting that.”

Laying the foundation for better representation for women in technology goes beyond STEM education.

Unearthing Opportunities for ESG investors

ESG investors can also bolster women-led tech innovation through donor-advised funds (DAFs), which Chloe offers in partnership with Impact Assets. Miller-Out notes that DAFs allow philanthropic ESG investors of any size to create more impact through re-investment of financial returns from social impact projects. Chloe also offers training for angel investors.

ESG investors have a range of gender lens investment opportunities for closing gender gaps in technology. Supporting nonprofits that center women in STEM, angel investing, participating in DAFs, and advocating for greater institutional investment in venture funding for women can all contribute to achieving Miller-Out’s goal: “to bring all the voices to the table to solve major problems in the key global challenges.”

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