Were you aware that COVID-19 is forcing many young girls to revert back to old practices like child labor, childhood marriage, and genital cutting? No? Well I didn’t either. And now that I know it’s absolutely devastating to think about. It makes me want to help, somehow, in any way. Now even if your answer to my question was “Yes, I knew that” you might still not know how you can help deter these practices. And believe it or not, how you choose to invest can make a difference!
How can my investments help girls all over the world?
According to a recent article in the Economist, a girl who finishes secondary school is less likely to become a child bride or a teenage mother.1 Keeping girls in school should be a top priority. The article states how the Covid-19 pandemic is affecting girls’ progress in poor countries and could lead to reversing some of the progress they’ve made.1 This happened back in 2014 when Ebola forced west African schools to close leaving many girls to never return to school. Instead, these girls ended up married or used as child laborers. If you invest in Socially Responsible investments, you are sending a message to companies that you don’t condone certain practices, therefore removing the possible distraction of child labor. It’s like you’re taking a seat at the Board of Directors meetings, where you can vote yea or nay to important topics such as these. One Socially-Responsible-Investment (SRI) money manager takes it a full step further where they buy shares in companies they feel need to implement change, and they buy enough shares to be an influence on their business practices. So this money manager might buy shares in a company that utilizes child labor, but makes sure to buy enough shares to be able to cast a strong vote to end its usage. It really is a fantastic way to use our investment monies!
Why should we screen our international investments?
I’ve said for a long time, if you’re going to invest Socially Responsibly, one of the most important places to do it is internationally, and even more specifically, do it within the emerging markets. That’s because child labor laws aren’t as strict there, and rules against sweatshops or other unhealthy working conditions are much more lax, if not non-existent.
What is considered an emerging market economy?
Let’s define an emerging market economy – it is one that is “transitioning from a low income, less developed, often pre-industrial economy towards a modern, industrial economy with a higher standard of living”.2 Think: India, Mexico, Russia, Pakistan, Saudi Arabia, China and Brazil.
From a more macro-perspective, such as in terms of GDP, it’s still extremely important that we keep girls in school. Citigroup and Plan International conducted a study that estimated if a group of emerging economies ensured that 100% of their girls completed secondary school, it could lead to a lasting boost to their GDP of 10% by 2030.1 Her education leads to her having higher earning power and more choices available to her, which means she is less likely to be poor or to suffer domestic abuse.1 As a result of her advantages she will likely have fewer children which enables her to invest more in them. She will read to them more, value school for her children and help them with their homework leading to her children’s increased possibilities.1 And what’s more is that she will teach these great lessons to her children starting a tradition of education and progress.
Just think, as investors we can help promote this change. Isn’t that amazing? We have more power than we thought. And collectively, we have lots of power. It’s a beautiful thing that we shouldn’t waste. Together we can encourage growth and progress both here, in our own neighborhoods, and abroad.
If you feel compelled to review your investments to see how they are speaking with your investment dollars, schedule a time with me so we can do it together. Using sophisticated software and industry knowledge, it would be my honor to help you.
1 Getting Girlhood Right- Covid-19 Threatens Girls’ Gigantic Global Gains. www.Economist.com. 22 Dec 2020.
2 Emerging Market Economy Definition. www.Investopedia.com. 22 Dec 2020.