Summary

Impact Investment Exchange (IIX) is unlocking over USD 150 million in capital through Women’s Livelihood Bond Series (WLB Series), which will empower over two million women in South and Southeast Asia. The WLB Series helps women access affordable credit, micro savings and insurance, agricultural inputs, as well as clean and affordable energy. Capital is provided up-front, allowing women to fund income-generating assets and skills to transition from subsistence to sustainable livelihoods. The WLB Series is well aligned with 12 of the United Nations’ Sustainable Development Goals (SDG), particularly SDG 5: Gender Equality and SDG 13: Climate Action. 

The project recognises that empowering women through sustainable livelihoods in turn helps their community adapt to a changing climate. The Women’s Livelihood Bond™ 2 (WLB2) will build on the success of the Women’s Livelihood Bond™ 1 (WLB1), an US$8M debt security closed in July 2017 which creates sustainable livelihoods for over 385,000 women across Southeast Asia. The WLB2 will be listed on the Singapore Stock Exchange. The WLB2 is an innovative financial instrument that mobilizes private sector capital for positive social and environmental impact, while offering financial returns to investors independent of social outcomes. 

Key Facts

• The first Women’s Livelihood Bond (WLB1) unlocked USD 8 million of private capital, which created sustainable livelihoods for 385,000 women in Southeast Asia.

• The second Women’s Livelihood Bond (WLB2) significantly increases the number of women impacted by the Bond to over two million across South and Southeast Asia.

• Majority of the beneficiaries of the WLB2 are women – and by creating opportunities for advancement, the Bond provides women with the tools to become leaders in their economies and affect change from the ground-up.

The Problem

Climate change is one of the greatest challenges of our time – in addition to its devastating environmental consequences, it also exacerbates significant human rights issues, with women bearing the brunt of climate-related shocks. Due to their work in agricultural industries or informal or vulnerable employment, they tend to lack the resources to cope with worsening climate-related losses. 

Furthermore, low income women in the developing world are often trapped in subsistence living due to structural barriers. This makes it harder for them to cope with economic shocks. As such, the key to building greater resilience for women and climate resilience for their communities is to empower them to become solutions to climate change through sustainable livelihoods.

The Solution

In line with addressing the problem, IIX has developed the Women’s Livelihood Bond 2 (WLB2) – a USD 150 million bond series designed to empower over two million underserved women in South and Southeast Asia with sustainable livelihoods. The Bond builds their resilience to climate change through access to affordable credit, products such as disaster insurance, agricultural inputs to support climate adaption, as well as clean and affordable energy to support climate change mitigation. As such, the WLB series effectively changes the dominant narrative from women as victims of climate change to women as solutions to climate action. 

The mechanism itself is an innovative financial instrument that mobilizes private sector capital for positive social and environmental impact. It offers financial returns to investors independent of social outcomes, and is able to be listed on both social and traditional stock exchanges. The WLB2 builds off of the success of IIX’s first Women’s Livelihood Bond (WLB1), which was the world’s first impact investing instrument and the first financial instrument focused on women to be listed on a stock exchange, reported both social and financial returns.

Helping the Planet

In order to help mitigate climate change, the WLB2 includes environmentally focused enterprises in the clean energy and sustainable agriculture sectors. Through scaling clean energy enterprises, communities can decrease their dependence on non-renewable sources of power, thus reducing carbon emissions. Similarly, by expanding sustainable agriculture enterprises, communities can better utilize their natural resources while decreasing pollution and wastage.

The Bond’s capacity to scale up sustainable, climate-smart agriculture has been shown to increase employment opportunities, grow incomes, improve resource efficiency and elevate productivity to allow for less time spent on subsistence activities. In the long-term, this allows for reforestation and the cultivation of resilient and sustainable communities.

Helping People

The WLB2 reduces vulnerabilities of underserved women and their communities, enabling them to better cope with the effects of weather-related shocks. By scaling environmentally focused enterprises, communities in the developing world are better able to access affordable and clean energy. This in turn decreases their dependence on traditional forms of energy that are typically inaccessible or prohibitively expensive in times of crisis.

Moreover, scaling up sustainable agriculture increases employment opportunities, the amount of money earned and productivity to allow for less time spent on subsistence activities. In the long term, this allows for reforestation and the cultivation of resilient and sustainable communities. WLB2 focuses exclusively on women as IIX believes that women are the key to unlocking more resilient communities. This is because women are the backbone of rural enterprises and also play a pivotal role in advancing the overall welfare of their families and the wider community. By empowering them with capital resources unlocked by WLB2, women will be positioned to reach their full economic potential and spearhead climate adaptation in their communities.

Spillover Effect

The Women’s Livelihood Bond can also be expanded to include more countries. WLB2 includes more developing countries like India, Sri Lanka, Indonesia, as well as Cambodia and the Philippines. In the future, IIX aims to bring the Women’s Livelihood Bond to developing countries across Asia, Latin America and Africa. In addition, IIX aims to launch the Women’s Climate Bonds (WCB) which positions women as solutions rather than victims of climate change, and will focus on Sub-Saharan Africa. 

The WLB series has also brought a wide range of private and public sector partners across many industries into the sustainability equation, contributing to a larger ecosystem-building process of knowledge sharing and collaboration. This enables ecosystem actors to gain expertise in innovative finance and climate friendly investment.

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