An interview with Katie Kaufman, Managing Director, Global Women's Issues
Client Interview: DFC 2X
In 2016, the Development Finance Corporation (DFC), the United States’ development finance arm, began planning a $1 billion investment to support women in developing countries. It was the single largest financing commitment the government had ever made for global women’s empowerment.
Plans for the initiative were spurred by the revelation that the world’s fastest-growing emerging market is not a country or a region: it is the world’s women. They represent a potential $28 trillion added to the global GDP. And moreover, for every dollar a woman makes, she invests 90% of it back into her family – on food, education, and healthcare. That is three times the amount of her male counterpart. In this light, the impetus to include women in the world’s economy shifts from good ethics to good business.
We volunteered to help name the initiative. In considering names, we knew it must evoke the impact that investing in women can have. Because the statistics ran counter to deeply embedded cultural narratives, we also recognized the importance of leading with the business case. The result was 2X, a representation of that multiplier effect as well as a subtle nod to the female chromosome.
That first year, they exceeded their $1 billion goal. At the G7 Summit, they called each member nation to take on the 2X Challenge and to increase their level of investment in women. All seven signed on. Together, they mobilized $3 billion dollars.
We caught up with Katie Kaufman, the managing director of DFC 2X, to ask her about the program today, and its significance for her.
Interview by Kate Baughman
KB How has the program impacted your work?
KK After we launched 2X, we finished the two largest years in our agency’s history. We went from 4% of transactions meeting 2X standards in 2016 to over 50% of last year’s commitments meeting that criteria. Today, we’re asking different questions when we approach deals to invest. Gender is material to any transaction we make; it’s a consideration to every investment strategy.
KB That is amazing. What is a success anecdote you have seen while traveling?
KK I have two, actually.
I’ve seen what access to clean water did for a group of women in a village in India. These women spent most of their lives collecting the water that their families needed to survive. I think about that every time I turn on my faucet. We financed construction for a clean water well, and it completely transformed their lives.
In Africa, we met with over 100 female entrepreneurs. Every pitch was a worthy investment anyway, but every single one was mindful of community. They weren’t there to make a profit. They were all passionate about serving beyond the revenue projection. That’s not something you always see in a pitch presentation.
KB Why is the mission of 2X important to you?
KK When I first took the job, it was not something that was important to me. I hadn’t really thought about gender in a meaningful way. But then I came to discover the treatment of women around the world: profound lack of access to credit, unconscious bias, still handling 90% of childcare. And, they still outperform from an economic perspective. For every dollar invested in a woman, she’ll on average generate 79 cents. For reference, a man will generate 47 cents. There are incredible statistics around women’s performance in business. Now that I understand this reality, I don’t think we’ll be able to address the Sustainable Development Goals – the world’s to-do list – unless and until we have gender equality.