Pink Chip was created to fight the gender leadership gap, a gap is estimated to take 140 years to close. This work hastens its demise by forcing the business world to reckon with the financial cost of their bias against female leaders. Launched in partnership with UN Women NL, the initiative is firmly aligned with the UN’s SDG 5.5: Ensure women’s full and effective participation and equal opportunities for leadership at all levels of decision-making in political, economic and public life, and its impact is felt through indicator 5.5.2: Proportion of women in managerial positions.

Though Pink Chip is designed to make a difference across the globe, its first iteration was built using American businesses. The reason for this is two-fold. Firstly, although DEGIRO is a European company, its user base takes a greater interest in the American market than any other - helping to get the project off the ground with as great an impact as possible. Secondly, America is home to the world’s largest financial markets, the NYSE and the NASDAQ. By focusing on businesses that were listed in the nation home to these financial powerhouses, the project could be sure to have more eyes on its launch than if it had been focused on businesses in any other market. The bias that Pink Chip is devoted to fighting, however, is found in every corner of the planet and so the project is already focused on expanding into other major markets around the world.

DEGIRO, Europe’s largest investment app, believes that investing isn’t just about money, it can make a better world. To that point, it highlights Environmental, Sustainable, and Governmental scores on its platform so investors can make informed decisions and has a longstanding partnership with educational platform Lynda dedicated to helping women get their start on the investment ladder. As women only make up 1 in 5 investors globally, this approach has been critical in encouraging them to take their first step in a world where they may not normally feel welcome and contributes towards the “full participation in economic life” that is enshrined in SDG 5.5. So far this has proven popular with female investors who have flocked to DEGIRO’s app at a faster rate than men for the last 7 years. While Pink Chip is focused on elevating female leaders in business, its tactics focus on reversing gender bias in the investment community at large which in turn has a positive halo effect on potential female investors looking to get their start and find economic independence.

Research shows that companies with female leaders tend to be more profitable and have better stock price performances. Despite this, just 7% of CEOs of publicly listed companies around the world are women. To make matters worse, when companies actually appoint a female CEO, their share price can drop by 2 to 3% as investors sell their shares upon hearing of their recruitment or promotion – placing female leaders at a disadvantage before their tenure has even begun. This isn’t just bad for society, it’s a poor investment strategy. DEGIRO recognised that their platform had the ability to reverse this bias and close the leadership gap. While data blindspots and male investor reticence to change long-standing habits may have been stubborn obstacles to overcome, the potential to make a real difference to society and their consumers made them hurdles worth clearing.

This work is deeply rooted in the global movement towards gender equality and diversity in the workplace. Despite significant strides towards gender parity in recent decades, there remains a pervasive bias against women in leadership positions. These deeply ingrained biases can manifest in subtle ways, such as investors being more likely to sell their shares in a company once a woman is appointed as its leader, regardless of her qualifications or track record. While there is an increasing awareness of the benefits of gender diversity in the workplace, the reluctance to invest in and appoint female leaders is a missed opportunity for both businesses and investors, as well as an enduring injustice for the women that deserve to be in these roles.

Pink Chip is a first-of-its-kind live index designed to make the success of female leadership impossible for investors to ignore by reframing a moral failure as a financial one. The index, initially for the US market, tracks the performance of female-led businesses and measures it against industry benchmarks and direct male competitors. For the first time, investors could see for themselves how investing in women is better for their bottom line and, through DEGIRO’s platform, choose to buy shares in women-led companies that attracted their attention. The initiative, however, isn’t just for the benefit of investors. By promoting the power of female leadership, it contributes to the UN’s Sustainable Development Goal 5.5: Ensure women’s equal opportunities for leadership in political, economic and public life - because of this, UN Women NL joined as a launch partner to offer guidance during development and amplify Pink Chip’s message.

Research into the “leadership gap” and a series of interviews with academics and activists in this field revealed a series of statistics that didn’t add up. Women outscored men in 17 of the 19 key leadership capabilities, firms with female CEOs produced superior stock price performances, and businesses led by female decision-makers reported above-average profits. In spite of this, Wall Street investors place a lower value on the shares of female-led companies, those businesses are 63% less likely to receive venture capital funding, and excessive negative media attention means a company’s stock price can fall by up to 3% when a female leader is announced. This led to our insight: this bias isn’t just bad for female leaders, it’s also bad for investors. By using their platform to reverse it, DEGIRO saw that they could boost their users’ returns while supporting women in business.

Pink Chip used AI and name recognition software to trawl through an extensive data-set of corporate structure filings and create a list of women-led companies, a list that didn’t exist before. In addition to requiring a female leader (Pink Chip is inclusive of all female-identifying people), the index had criteria based on market capital and consistent revenue growth to rule out “caretaker CEOs” and the glass cliff effect. DEGIRO then enlisted Thematic, ​​an AI-powered investment research platform, to collect the back-end data on which Pink Chip is built and refresh the list of companies on a daily basis. The index, the companies featured, and the methodology used to create Pink Chip are all freely available on PinkChip.org. Pink Chip is also on DEGIRO’s app where investors can compare its success to other indices and choose to invest directly in women-led businesses.

Pinkchip.org attracted 70,000 visitors within its first week. Within three weeks, over 14,500 DEGIRO users invested in Pink Chip companies. In that time, those companies saw a 6.7% stock price increase while the index climbed 9.48%. Overall, Pink Chip has outperformed market benchmarks by over 80% and continues to climb. It has also been championed by academics who now have an open data-set of female-led companies to use across their research. On top of all this, thanks to the support of UN Women NL and grassroots activists, Pink Chip made over 58m online impressions, reached over 85m people, and was added to Bloomberg. Through its partnership with UN Women, Pink Chip also encourages all companies on the index and beyond to sign up to the Women’s Empowerment Principles - a set of guidelines on how to advance gender equality and women’s empowerment in the workplace.

Pink Chip is more than just an index, it’s an initiative with big plans to make a lasting change. An advisory board has been set up featuring leading figures across 5 different countries. Its job is to ensure Pink Chip can evolve in an independent way that maximises the impact it can make. DEGIRO understands that to make a difference across the industry, the solution needs to take place beyond its own borders and conversations are currently underway with a number of competing investment platforms that are eager to host Pink Chip. In addition to this, DEGIRO and Thematic are also in the process of creating new Pink Chip indices for more major markets, with an immediate focus on EU, UK, and Canada. Better still, with its data included in a variety of academic studies, Pink Chip can impact the perception of female leaders far beyond the business world.

Pink Chip is a digital-first project that eschews any traditional formats, reducing its real-world environmental impact. The project was centrally developed by a small female-led and female-majority team, and this was true across both agency and client. By having UN Women NL on board as a partner throughout the development process and through to launch, the project had the perfect sounding board at every step to sense-check key decisions and seek advice on ensuring that the initiative stayed true to its ambitions.