Natasha Narsingh, CEO of Sanlam Investments Active Manager

South Africa, 19 March 2024: By the end of this decade, women will control much of the $30 trillion¹ Baby Boomer wealth transfer. This equates to close to the total annual GDP of the United States.  Furthermore, Africa’s population of millionaires will increase by 42% in the next ten years², with women forecast to be at the forefront of this growth. Globally, there’s been a pandemic-linked paradigm shift: women are owning their economic power, and the financial services industry needs to step up to cater to their chronically overlooked female powerhouse clients.

It’s hugely promising to see the seismic shifts happening worldwide. We’re finally seeing years of campaigning for gender parity start to pay dividends. Progress is not nearly fast enough, but we must celebrate the strides being made. Notably, women are emerging as some of the swiftest growing investor segments.

Positive progress for women worldwide

Interestingly, the pandemic prompted more women to start engaging in financial discussions, effectively starting to talk money. That’s had huge positive effects. According to Fidelity, since 2020, the proportion of female investors in the US, investing outside of their retirement accounts, has risen to 67%, from 44% pre-Covid-19. Additionally, there is a growing trend of women that are now saving for retirement, and women are starting to invest at earlier ages. The ‘gender investing gaps’, which is essentially, the gaps between men and women investing in the stock market, are narrowing – albeit slowly – and the financial services industry has a massive role to play in assisting more women to harness and ‘own’ their economic power.

This is a big part of Sanlam Investments’ aim, to invest with confidence in the future we need. We are dedicated to making a positive impact on the lives of women. Through various initiatives, including workforce diversity, impact funds, and corporate social investment projects, we strive for equality and empowerment in everything we do.

Empowering women to invest with confidence.

Numerous studies reveal that while women investors tend to garner better investing returns than men, they still exhibit less confidence in their investing abilities, with financial literacy consistently identified as a key barrier.

Additionally:

• Fidelity found just 33% of women see themselves as investors.
• Vanguard (2020) revealed that 50% of women were less likely than men to trade actively.
• BNY Mellon found just 1 in 10 women globally felt they fully understood investing.
• Reuters reported 45% of women see the stock market as too risky for them.

There’s a staggering statistic from BNY Mellon estimating that if women were to invest at the same rate as men, there would be an extra US$3.2 trillion of assets under management from private individuals, which is more than the UK’s total GDP. As asset managers, we have a profound duty to empower women to step into their power and invest with confidence. We know that traditionally women have felt sidelined, patronised and overlooked by the financial services industry – in fact, one study¹ found 86% of asset managers still target their products at men.

This is simply unacceptable; gender empowerment should be a non-negotiable. The financial services sector must take the time to understand women investors’ evolving expectations and what they feel they need in an investment partner. More focus must be placed on accessible financial literacy and on boosting investing confidence early on. We need to close the confidence gap in order to close the investment gap. We also need to nurture the attributes that make women extremely capable investors, such as a historic natural risk aversion, desire to invest with impact, and willingness to ‘wait it out’ during periods of market volatility.

Additionally, we must put more emphasis on diversifying teams to upskill more women financial advisers and asset managers. As a leader in our industry, we are committed to accelerating representation of, and opportunities for women at all levels across our group. To date, 55% of our staff across the Sanlam Investments is female, and this includes 41% of managers, and 23% of senior leaders. We are committed to improving these numbers as we continue to ensure we have the right people in place to be trusted custodians of our clients’ funds.

Women are owning their financial power. Over 80% of female investors globally are now using online platforms to build their wealth. Women are economic powerhouses that the financial services sector simply cannot afford to overlook. Empowering women investors is not just good business sense, it’s a moral imperative. Financially empowering women is the surest way to positively change the world.”

ENDS

References:

1. McKinsey: Washington Post: The wealth transfer from baby boomers mostly benefits women
2. Henley and Partners, Forbes Magazine: What wealth will look like in 2024
3. Bloomberg: The multi-trillion women investor