Closing the gender gap through education

Gender equality is at the heart of human rights.

United Nations (UN) research has demonstrated that educated women improve the health and wellbeing of their families and communities. Women's empowerment is central to reducing poverty, promoting development and addressing the world's most urgent challenges. Giving girls access to quality education is crucial to realizing a more equal world, but 16 million girls aged six to 11 will never start school. That is twice the number of boys.

If the UN's 17 Sustainable Development Goals (SDGs) — including SDG #5 to achieve gender equality — are to be met by 2030, a funding gap of nearly $2.5 trillion needs to be plugged. And private investment may be a way to raise these funds.

As more private investors divert their attention to sustainable and impact investing initiatives, the popularity of Development Impact Bonds (DIBs) is surging, thanks to their results-based financial returns.

"This first Development Impact Bond is leading the way in demonstrating how such innovative financing models can unlock new and much-needed sources of funding and deliver even greater impact on the ground," said Phyllis Costanza, CEO of UBS Optimus Foundation.

India-based Educate Girls is a NGO with 11,000 volunteers who go into rural and tribal communities to enroll schoolgirls. They continue working with their families and in the classrooms to ensure the girls remain in primary education and meet learning targets in English, Hindi and mathematics.

Educate Girls is partly funded by the world's first DIB for education, backed by UBS Optimus.

The initial investment by UBS Optimus is paid back by the outcome payer in this case the Children's Investment Fund Foundation (CIFF). Investment performance is monitored closely by evaluator IDinsight to ensure that literacy and numeracy targets are met, and CIFF will pay interest of up to 15 percent, depending on the improvements achieved.

The results of the second year of the three-year program show that Educate Girls has already achieved 87.7 percent of its three-year enrollment target, but just 50.3 percent of its three-year learning target. UBS and its investors are on track, therefore, to recoup their investment.

Safeena Husain, founder and executive director of Educate Girls, said the DIB's rigorous approach to data collection and analysis has transformed the way the organization works, making it more operationally effective.

"Educating girls is the battle of our lifetime" said Husain. "An educated girl is 500 times more likely to educate her children. So, we just have to do it once and she will transform the next generations to come."

Somaliland has some of the world's lowest enrolment rates for elementary, junior high and high school so going to university remains a distant dream for most Somali girls. However, a new all-female university is benefiting from private investment. In September, Jonathan Starr opened Barwaaqo University for Women in the capital Hargeisa. The university is modeled on Starr's
 successful Abaarso School, funded in part by Wall Street donors. Teachers are trained so that they also serve as role models and encourage younger Somali girls to continue their education.

Starr said: "Barwaaqo University offers donors the opportunity to fund a student's journey to self-sufficiency and ultimately well beyond that to becoming an impactful leader in society.

"Many donors consider Abaarso School and Barwaaqo University to be tremendous deals, as they can achieve that kind of impact for under $2,000 per student per year.

"Abaarso School has accepted full-scholarship students for a few crucial years and then helped those talented individuals go on to $300,000 worth of international scholarships. Our donors are very attracted to that kind of leverage."

Barwaaqo University plans to expand and open faculties of business, IT, nursing and engineering in future years, enabling Somali women to build their country's infrastructure and contribute to the economy.

Figures show that if every country boosted the number of women in the workplace to match the progress toward gender parity of its fastest-improving neighbor, global GDP could increase by $12 trillion within a decade.

UBS believes that partnerships, rather than investors going it alone, increase the scale of impact in order to meet the SDG's 2030 deadline for its 17 gender equality and female empowerment goals.

UBS is also placing women at the heart of its own strategy. Two years ago, the bank launched UBS Unique specifically for its wealthy female clients, recognizing that they have different needs and values. The bank has also collaborated with photographer Annie Leibovitz and singer Joss Stone to celebrate inspiring women.

With so much investment potential and GDP growth at stake, educating women is considered a high priority and worthwhile effort in 2018 and beyond.

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