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Why Melinda Gates’s $1 billion pledge for women and girls is a game-changer

Melinda Gates’s $1 billion pledge to advance women and girls is attention-grabbing because of its size, but it’s also unusual for another reason.

Gates, the wife of Microsoft MSFT, -0.72% co-founder Bill Gates, will spend the money over the next decade to expand women’s power and influence in the United States.

In the world of charitable giving, devoting money to women’s and girls’ causes is a rarity. Women’s and girls’ groups received just 1.6% of charitable dollars in 2016, the most recent year for which data was available, according to a new report by the Women’s Philanthropy Institute at Indiana University’s Lilly Family School of Philanthropy.

The first-of-its-kind report examined giving to organizations that serve women and girls primarily — as in Planned Parenthood or Girls, Inc. — as well as giving to collectives of women that have a philanthropic purpose, such as Junior League groups.

While there’s been a national debate on gender equity in recent years, that reckoning doesn’t appear to have had much of an effect on charitable donations, the researchers noted.

“News stories about sexual assault and harassment, as well as various policy developments and current events, have brought issues impacting women and girls to the fore of societal conversations,” the report’s authors wrote. “Does charitable giving also prioritize this population? This report shows that it has not.”

The #MeToo factor hasn’t been measured yet

One caveat to the findings: the data are from 2016, before Hillary Clinton lost the presidential election and before the #MeToo movement drew international attention to gender inequities, noted co-author Debra Mesch, professor of philanthropic studies at the Lilly Family School of Philanthropy. The authors didn’t analyze why female-focused groups get such a small share of donations, but one factor could be the relatively small staff and budget sizes of nonprofits that serve women, which means they have fewer resources for fundraising, Mesch said.

There are 45,000 nonprofits focused on women and girls in the U.S., or 3.3% of all charitable organizations, the WPI report found. They received $6.3 billion — or 1.6% of all giving — in donations from individuals, foundations and corporations in 2016. The WPI report was funded by the Bill and Melinda Gates Foundation, but its release the same week as Melinda Gates’s announcement was a coincidence, the authors said.

‘Actionable plans’

Gates’s $1 billion initiative will focus on three strategies: removing obstacles to women’s professional advancement; advancing women in fields that have a significant influence on society, including technology, media and politics; and ramping up pressure that employees, consumers and shareholders put on companies and other institutions “in need of reform,” she wrote in a first-person piece for Time magazine.

Though the IWP report found that only a sliver of giving goes to women’s causes, Mesch sees positive trends in female-focused giving. Gates’s $1 billion pledge is part of a larger movement to improve the lives of women and girls that’s been led in part by female philanthropists, she said. It includes groups like Women Moving Millions, which launched in 2012. Its members pledge to donate $1 million to women’s and girls’ causes.

“They’re using their wealth through their philanthropy to create change, which is exactly what Melinda is talking about,” Mesch said. “She’s working on actionable plans and results, it’s a tremendous step that will rise all boats in all sectors: the philanthropic, the private, as well as the government sector.”

See also: Procter & Gamble donated $529K to help U.S. women’s soccer win equal pay — while paying some of its U.K. female workers 28.5% less than men

Investing in startups and research

Melinda Gates’s $1 billion pledge will be distributed through Pivotal Ventures, an investment and “incubation” company she founded in 2015. (The business world has similar gender disparities to philanthropy: 2.2% of venture capital investment went to firms founded solely by women in 2017, according to PitchBook.)

Melinda Gates will give out the money as a combination of philanthropic grants and investments, a spokeswoman said. Pivotal Ventures has previously invested in a female-led AI startup, funded a program at Northeastern University to get more women into tech, and helped fund a paid leave working group at the American Enterprise Institution and Brookings Institution.

See also:Who donates more time and money to charity — men or women? Here’s your answer

Melinda and Bill Gates, who is one of the richest people in the world with an estimated net worth of about $106 billion, also channel their philanthropy through the Bill and Melinda Gates Foundation, the biggest charitable foundation in the world, according to Forbes magazine. Gates has given away about $35.8 billion, or 25% of his net worth, to charity, Forbes reported.