The United Nations Economic and Social Commission for Asia and the Pacific (ESCAP) and FDI Center recently launched the "Pledge Amongst Investment Promotion Agencies, Economic Development Boards, and Ministries of Investment to Advance Gender Equity in Foreign Direct Investment". The pledge aims to increase the number of FDI-mandated organisations that incorporate gender equality in their investment promotion strategies and apply a gender lens across their operations and services. It also seeks to foster a culture of inclusion, leadership, and empowerment for women who work in the FDI sector. The initial signatories include Invest in Canada, Investment Fiji, Bhutan Invest, Board of Investments (BOI) Philippines, BOI Sri Lanka, BOI Thailand and Malaysia Digital Economy Corporation (MDEC).
The pledge outlines nine action areas that offer guidance on how organisations mandated to promote investment can contribute to gender equality. The action areas were defined with the varying mandates, resources, and developmental stages of the target signatory agencies in mind. By signing the agreement, the signatories have endorsed the pledge and committed to implementing at least three action areas, while tracking and reviewing their impact. This pledge is initially valid for three years, from May 2024 to April 2027, after which it will be reviewed.
The accomplishment of Sustainable Development Goal (SDG) 5 (Gender equality and women's empowerment) requires a united front, with no country, organisation or sector overlooked as a contributor towards achieving global gender equality. This also includes the field of foreign direct investment. Until recently, FDI has gone relatively unnoticed as a vehicle for furthering progress towards SDG 5, despite many investment, business and trade-mandated organisations and ministries implementing gender equality measures in their trade work. Furthermore, there is a severe lack of data on the impact of FDI on women and girls to attest to the value of introducing such measures into their investment attraction work. Research conducted by FDI Center affirmed the global underrepresentation of women in the field of FDI, which only exaggerated higher up the leadership chain.
However, the small but growing amount of data indicates that given the right tools and consideration, FDI has tremendous potential to contribute positively to SDG 5, when facilitated by investment promotion bodies and investors working together to deliver a real impact on the economic opportunities for women and girls.
"FDI is the largest source of external financing in developing countries, exceeding funds from bilateral donors (official development assistance) and multilateral development banks, private equity as well as venture capital," said Rupa Chanda, Director of Trade, Investment and Innovation Division, ESCAP.
"When investment attraction institutions engage with foreign investors consciously, FDI has transformative potential for sustainable development in the host economy, including a positive impact on gender equality," emphasised FDI Center's Gender Initiative Lead, Kathryn Rothwell.
To bring FDI's potential to further SDG 5 to fruition, more initiatives are required to support investment promotion agencies (IPAs) and similar-mandated organisations in integrating gender equity measures internally within their organisations and into their FDI attraction work. Therefore, this pledge intends to support organisations with FDI attraction mandates to contribute towards facilitating a greater positive impact of FDI on gender equality in host economies; and promoting gender equality internally within institutions that work on investment promotion. By raising the profile of the topic and plugging the epistemological gap, more IPAs and Ministries of Investment will be encouraged to incorporate gender equality into their work.
Kamal Chetty, CEO of Investment Fiji, recognised that "diverse and inclusive investment practices lead to more innovative and resilient economies." Therefore, "advancing gender equity through FDI is not just a moral imperative but also a strategic advantage for sustainable development."
Similarly, Renuka M. Weerakone, Director General of BOI Sri Lanka, stressed the role of "women as a significant element for economic prosperity, intrinsically linked to sustainable development", and acknowledged "the significant impact FDI can have in advancing gender equality through job creation, reducing gender pay disparities and sharing best practices". In addition, Mahadhir Aziz, Chief Executive Officer of MDEC asserted that "by championing gender equity, we are not only advancing our digital economy but also ensuring that the benefits of our initiatives are accessible to all segments of our society."
Lastly, Laurel Broten, CEO of Invest in Canada, encouraged more organisations to adopt gender equality measures. "We hope this leadership (their commitment to the pledge) sets a standard that the partners and companies we work with can replicate in their operations."
