Which EU countries have the biggest gender gap when it comes to investment? – Euronews.com

Report on the European Gender Investment Gap and its Implications for Sustainable Development Goals

Executive Summary

A significant gender investment gap persists across Europe, hindering economic growth and impeding progress towards key Sustainable Development Goals (SDGs). Analysis reveals that companies founded by women are underrepresented and receive disproportionately less funding compared to their male-founded counterparts. This disparity not only stifles innovation but also represents a substantial economic shortfall. Addressing this gap is critical for achieving SDG 5 (Gender Equality), SDG 8 (Decent Work and Economic Growth), SDG 9 (Industry, Innovation, and Infrastructure), and SDG 10 (Reduced Inequalities).

Analysis of Gender Disparity in European Entrepreneurship

Data from the European Commission’s “The Gender Investment Gap” report highlights a critical challenge to achieving SDG 5 (Gender Equality), particularly Target 5.5, which calls for women’s full participation and equal opportunities for leadership in economic life. The findings indicate a persistent disparity in the European tech sector.

• Between 2020 and 2025, only approximately one in five tech companies established in Europe included at least one female founder.
• The European average for companies with at least one female founder stands at 19.3%.
• Even when founded, companies with women founders receive less investment than those founded by men.

There is significant variation among member states:

1. Highest Diversity: Latvia (27%), Italy (25.9%), and Portugal (25.2%) demonstrate higher-than-average rates of female participation in founding companies.
2. Lowest Diversity: Countries such as the Czech Republic (9%) and Hungary (14.4%) fall well below the European average, indicating a greater need for targeted interventions to promote gender equality in entrepreneurship.

Economic Consequences and Impact on SDG 8 and SDG 9

The gender investment gap has profound economic consequences, directly undermining the objectives of SDG 8 (Decent Work and Economic Growth) and SDG 9 (Industry, Innovation, and Infrastructure). The failure to leverage the full entrepreneurial potential of women results in a significant loss of economic productivity and innovation.

• A 2025 Frontier Economics study estimates that equal participation by women entrepreneurs could increase the EU’s GDP by approximately €600 billion by 2040.
• Female-owned small and medium-sized enterprises (SMEs) face greater barriers to finance, reporting loan-approval rates five percentage points lower than male-owned firms, which contravenes the aims of SDG 9.3 to increase access to financial services for small-scale enterprises.
• The European Commission notes this shortfall represents “capital that could otherwise be fuelling innovation, employment, green – and digital transitions,” all of which are central to sustainable economic development.

Systemic Barriers Hindering SDG 5 and SDG 10

The persistence of the investment gap is attributed to deep-seated systemic and structural barriers. These biases actively work against the achievement of SDG 5 (Gender Equality) and exacerbate the issues targeted by SDG 10 (Reduced Inequalities).

• Cultural and Societal Norms: Entrepreneurship and venture finance have been historically associated with male-coded traits, while societal expectations regarding women’s caregiving roles limit access to networks and capital.
• Male-Dominated Decision-Making: The venture capital and private equity sectors remain predominantly male, which reinforces existing investment patterns and unconscious biases.
• Structural and Geographical Disadvantage: A “double exclusion” of gender and geography exists, as venture capital is concentrated in hubs like London, Paris, and Berlin, disadvantaging founders in Central, Eastern, and Southern Europe.
• Masked Biases: In societies perceived as egalitarian, the assumption that gender equality has been achieved can itself act as a barrier by masking ongoing structural issues.

Untapped Financial Potential for Advancing the SDGs

Closing the gender gap in retail investment could unlock substantial capital, providing a critical resource for financing the 2030 Agenda. This aligns with SDG 17 (Partnerships for the Goals), which emphasizes the need to mobilize financial resources for sustainable development.

• Female retail investors in Europe currently control approximately €5.7 trillion in assets, a figure projected to rise to €9.8 trillion by 2030.
• If women invested on a parity basis with men, an additional €2 to €3 trillion in private assets could be mobilized across Europe.
• This untapped capital represents a major opportunity to finance sustainable initiatives, including the green and digital transitions, thereby accelerating progress across multiple SDGs.

Analysis of Sustainable Development Goals in the Article

1. Which SDGs are addressed or connected to the issues highlighted in the article?

• SDG 5: Gender Equality

  This is the central theme of the article. It directly addresses the disparities between men and women in the tech and investment sectors, focusing on the “gender investment gap,” the underrepresentation of women founders, and unequal access to financial resources. The article’s entire premise is built on highlighting and explaining these gender-based inequalities.

• SDG 8: Decent Work and Economic Growth

  The article connects gender equality in entrepreneurship to broader economic outcomes. It explicitly states that equal participation by women entrepreneurs could increase EU GDP by approximately €600 billion, linking the issue to sustainable economic growth. It also discusses entrepreneurship and the growth of small and medium-sized enterprises (SMEs) as drivers of innovation and employment.

• SDG 9: Industry, Innovation, and Infrastructure

  The focus on tech companies, venture capital, and innovation places the article’s issues within the context of SDG 9. The article highlights how the lack of investment in female-founded companies hampers innovation. It discusses the struggle of small enterprises (female-owned firms) to access financial services like bank loans and venture capital, which is a key aspect of fostering a supportive industrial and innovative ecosystem.

• SDG 10: Reduced Inequalities

  The article details systematic disparities that lead to the economic exclusion of a specific group (women). It discusses how women face lower loan approval rates and receive less investment, which are clear examples of economic inequality. The mention of a “double exclusion” based on gender and geography (disadvantages for founders in Central, Eastern, and Southern Europe) further reinforces the relevance of this goal, which aims to reduce inequality within and among countries.

2. What specific targets under those SDGs can be identified based on the article’s content?

1. Target 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.

   The article directly relates to this target by highlighting that “only about one in five tech companies… included at least one woman founder.” It also points to the lack of women in leadership and decision-making roles within the investment world, stating that “decision-making bodies in venture capital and private equity remain male-dominated.”

2. Target 5.a: Undertake reforms to give women equal rights to economic resources, as well as access to… financial services.

   This target is addressed by the article’s core focus on the “gender investment gap.” It provides evidence of unequal access to financial services, noting that “female-owned firms report loan-approval rates about five percentage points lower than male-owned firms” and that companies with female founders “received less investment.”

3. Target 8.3: Promote development-oriented policies that support… entrepreneurship, creativity and innovation, and encourage the… growth of micro-, small- and medium-sized enterprises, including through access to financial services.

   The article’s discussion on supporting women entrepreneurs and providing them with access to venture capital and bank loans aligns perfectly with this target. The potential €600 billion increase in EU GDP is presented as a direct result of better support for female entrepreneurship and SMEs.

4. Target 9.3: Increase the access of small-scale industrial and other enterprises… to financial services, including affordable credit, and their integration into value chains and markets.

   The challenges faced by female-owned SMEs in securing bank loans and venture capital, as detailed in the article, are a direct reflection of the issues this target aims to solve. The article shows that these small-scale enterprises are not getting the financial access they need to grow and innovate.

5. Target 10.2: By 2030, empower and promote the social, economic and political inclusion of all, irrespective of… sex.

   The article describes the economic exclusion of women in entrepreneurship and investment. The “systematic disparities between women and men in accessing venture capital” is a clear example of the lack of economic inclusion that this target seeks to remedy.

3. Are there any indicators mentioned or implied in the article that can be used to measure progress towards the identified targets?

• Proportion of companies with at least one female founder: The article explicitly uses this indicator to measure female participation in entrepreneurship. It states the European average is 19.3% (“about one in five”) and provides country-specific data for Latvia (27%), Italy (25.9%), the Czech Republic (9%), and others. This directly measures progress towards Target 5.5.
• Loan-approval rates for female-owned vs. male-owned firms: This is a clear quantitative indicator of access to financial services (Targets 5.a, 8.3, 9.3). The article specifies that female-owned firms have rates “about five percentage points lower,” providing a measurable gap that can be tracked over time.
• Amount of investment capital received by female-founded companies: The article mentions that companies with female founders “received less investment.” While it doesn’t give a precise figure for the gap, it identifies the volume of investment as a key indicator for measuring the gender investment gap (Targets 5.a, 8.3, 9.3).
• Contribution of female entrepreneurship to GDP: The article implies this as an indicator of economic inclusion and growth (Targets 8.3, 10.2). It quantifies the potential impact, suggesting that equal participation could “increase EU GDP by approximately €600 billion,” making GDP growth a relevant metric.
• Proportion of women in decision-making bodies in venture capital: The article implies this indicator by stating these bodies are “male-dominated.” Tracking the percentage of women in these roles would be a direct measure of progress towards equal participation in economic decision-making (Target 5.5).

4. Table of SDGs, Targets, and Indicators

Source: euronews.com