Much has been made of the ‘power of the pink dollar’ over recent years. Whilst some companies have genuinely realised the value of the LGBT+ consumer segment and have reflected this in their advertising, we have not yet seen a wholesale embrace of using the power of 'our money' to push for greater equality. Recent social justice movements, including Black Lives Matter and gender identity related advocacy, have reinforced how pertinent social sustainably really is and how much this matters to marginalised communities.
There is no doubt that the collective wealth of the LGBT+ Community can significantly impact the global economy and represents a large proportion of global GDP. Recent data produced by investment firm LGBT Capital showed that the estimated LGBT+ spending power (effectively the LGBT+ GDP) is approaching a whopping four trillion USD annually. Their data also demonstrate the significant value of LGBT+ tourism for most countries' GDP - in some cases, this represents more than 1% of the country's total GDP. Perhaps most surprisingly, the estimated total household wealth of the LGBT+ Community is now over 20 trillion USD. We, the LGBT+ Community are a community which investors can scarcely ignore.
What are the opportunities for the LGBT+ Community to use the power of this enormous amount to support and effect change? The way people spend their money, the brands they support and the countries they travel to can slowly and quietly support change. But what we have not yet seen is an institutional galvanisation of the value of the LGBT+ community with in the financial services industry.
A new approach being pioneered by a group of LGBT+ specialists seeks to target the way the people that manage our money make their investment decisions. That is, how investment professions invest our monies and what in. An Alliance of four organisations, LGBT Great, LGBT Capital, Equality Group and the Bisi Alimi Foundation are calling on the financial services industry to apply an LGBT+ lens to investment decision making. Companies we invest our money in should be able to demonstrate commitment to LGBT+ equality and this should be clearly evidenced.
For example, an investment firm buying shares in a company could use a tool to determine whether they are acting ethically when it comes to LGBT+ equality. If that company knew they would only achieve investment (that is the cash to grow from investment firms) by having LGBT+ equality measures in place, then they would be more likely to adopt these dimensions. For this approach to work, it needs to be adopted at an institutional level and be a core part of the investment process. Making this work would involve the LGBT+ community and its supportive allies get behind this and support those organisations doing the right thing. This would mean that institutions incorporating an LGBT+ lens would know that they would be more likely to be supported by the community.
In order to support this approach, the Alliance is calling on large global investment institutions to support the development of LGBT+ lens investing so that the money of the community is only invested in companies who support and uphold LGBT+ equality. The Alliance is also looking to the LGBT+ community and its supportive allies to flex their muscle in telling the financial services industry, that is investors, exactly what their expectations are for those people who manage their monies. You can complete a short survey to contribute to the conversation and help the Alliance put the case forward.