This year’s theme of International Women’s Day (March 8, 2023) was “DigitALL: Innovation and Technology for Gender Equality.” It shines a spotlight on the technology gender gap and the adverse impact of the lack of access to technological innovations and education on gender equality in the digital age. According to the UN Women’s Gender Snapshot 2022 report, excluding women from the digital world has reduced the gross domestic product of low- and middle-income countries (LMICs) by as much as USD1 trillion over the past 10 years. This figure could rise to USD1.5 trillion by 2025, if the trend continues. This does not have to be the case: the demand for the science, technology, engineering, and math (STEM) workers of all skill levels is expected to be robust. For example, in Latin America and the Caribbean (LAC), the path to net-zero emissions by 2050 can create 15 million new jobs as early as 2030.
Unfortunately, women’s ability to access and retain jobs in the STEM industry, including the high-growing renewable energy (RE) and energy efficiency industry, has been limited by gender norms and stereotypes, along with the lack of gender-responsive workplace policies and infrastructure. Globally, women only represent 32 percent of the RE workforce, slightly more than their participation of 22 percent in the conventional energy sector. Men dominate in STEM-related careers, while women in the RE sector are concentrated in administrative employment, occupying only 28 percent of the STEM jobs in RE and just 14 percent of the STEM jobs in the wind sector. The construction sector remains almost exclusively male: across the LAC region, female participation in the construction sector is estimated to be 1–6 percent.
The Climate Investment Funds (CIF) partnership with IDB Invest — the private sector arm of the Inter-American Development Bank Group (IDBG) is an example of how climate finance can support green jobs for women. As the largest multilateral fund for climate first-movers and innovation in developing countries. Bringing together multilateral development banks and other partners, CIF finance and expertise create conditions for transformational, often first-of-their-kind solutions in nations on the frontlines of the climate crisis. CIF has partnered with IDBG for almost 15 years in the delivery of climate finance and through this partnership makes a direct contribution to boosting female employment, which is vital for achieving a just energy transition.
So how does this work?, Through its blended finance strategy, IDB Invest incentivizes private sector companies in the infrastructure sector with concessional funding for high-impact, high-risk projects by tying its provision to gender equality outcomes. The transformative impacts of the blended finance strategy are captured in two-gender outcome-based pilot projects in Mexico, financed through CIF’s Clean Technology Fund (CTF), the successes of both are summarized here:
Optima Energia: Energy-Efficient Street Lighting in Mexico
Optima Energía was involved in a project to install an energy-efficient municipal public lighting system in Ensenada, Baja California, Mexico. At the start of the project, it had a male-dominated work environment: over 85 percent of the engineering employees were male, as was the entire staff in purchasing and logistics. Only a third of the company’s 33 permanent employees were women, with most working in non-technical areas.
Offering a financial package totaling USD18.1 million with a potential reduction in interest rate in 2015, IDB Invest helped Optima Energia to prepare a three-part gender program for creating a more diverse work environment. First, the management expressed its commitment to the mission by becoming the 13th company in Mexico to sign the Women’s Empowerment Principles in 2015. Second, it met the government’s stringent national standard for instituting the policies and infrastructure (including creating a lactation area in the office space) that supported an inclusive work environment a year later. In doing so, Optima Energy made state history by being the first company in the state of Nuevo Leon to do so.
Finally, promising strides were also made in the company’s gender representation. By end-2018, 13 female students completed their internship in engineering, purchasing and logistics, and finance and management, with one hired full-time. In the field, Optima Energia made an extra effort to interview qualified female candidates when hiring temporary staff to work on the Ensenada project. In fact, four technical positions previously held only by men were created and awarded to women!
Bright distributed solar generation projects in Mexico
Residential photovoltaic solar energy company Bright pioneered a model involving the financing, installation, and operation of small-scale (< 50 kilowatts [kW]) solar rooftop power systems in Mexico. The company leases the systems to residential clients, enabling them to generate energy from their rooftop solar power system, thus lowering their energy bills by 20 percent. However, from a gender equality standpoint, Bright was lagging behind in female representation, especially in the technical positions.
Through a USD20 million concessional financial package signed in 2020, IDB Invest incentivized Bright to focus on increasing gender equality among its labor force, whereby financial incentives would be provided upon the introduction and implementation of a Gender Action Plan. To develop a recruitment strategy focused on bridging gender gaps, Bright partnered with the National Polytechnic Institute and the Autonomous University of Mexico State to recruit interns from the institutions’ engineering graduates. Between 2017 and 2021, Bright Energia hosted 28 interns, 20 of whom were female. More importantly, the recruitment strategy changed the entire employment path of the organization: in 2022, over 50 percent of all the core technical and leadership positions in the company were held by women.
The success of these projects has demonstrated the effectiveness of a blended finance strategy in providing the necessary financial impetus to propel the private sector to strive for gender equality outcomes and create inclusive workplaces. Just as significantly, this transformation has also led to the creation of jobs for young women whose entry can help to pave the way for many others to follow. Considerably more funding will be needed for across low- and middle-income countries to overcome the digital and STEM gender gap.