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Orange bonds


Why the future of financial inclusion could be orange

Published 25 September 2023 in Finance • 5 min read

A new asset class – the orange bond – aims to use the bond market to accelerate gender equity by providing financing for underserved communities and women-run businesses. 

Women initiate around 70% of small-to-medium-sized businesses worldwide. Despite this, nearly two billion women globally don’t have access to global financial markets. This disparity hampers their ability to invest in, raise funds for, and scale their ventures. 

Recognizing the immense potential of financial inclusion, I founded Impact Investment Exchange (IIX) 14 years ago with a mission to put women, underserved communities, and climate at the forefront of financial markets. Leveraging the experiences documented in my book The Defiant Optimist, this article explores the power of finance as a tool to change the world. 

At the intersection of profit and purpose is impact investing, a new-age avatar of capitalism that holds the key to unlocking development that can endure. As the epitome of capitalism, stock exchanges have historically been engines of inequality, existing exclusively for the 1%. So, the first thing we did at IIX was envision a social stock exchange – a trading platform that would connect businesses making a positive social and environmental impact with capital markets and would link a company’s financial performance to its social and environmental results. 

“A stock exchange that placed social and environmental returns on equal footing with economic returns would be a game-changer.” – The Defiant Optimist 

Impact Partners is a platform that brings together investors and impact enterprises, facilitating the flow of capital to underserved and underrepresented entrepreneurs to give them the resources needed to grow and scale. Within a handful of years, this social stock exchange has become the world’s largest private placement platform dedicated to impact investment. 

After successfully launching Impact Partners, we pushed the envelope further by issuing our first bond – the Women’s Livelihood Bond (WLB) – in 2017 and injecting more capital into the market for gender equality.  

In creating this bond, I took inspiration from some unconventional examples, including Michael Milken, the American financier and convicted felon who galvanized the junk bond market in the 1980s. His brilliance was to reorientate investors’ perspective of high yield or junk bonds as high risk and high return. Further, he structured his bonds in a way that allowed companies previously excluded from the financial markets (sometimes because of discrimination due to their owners’ religious and economic backgrounds) to raise billions of dollars.  

Rather than extreme wealth for the few, we used the same thinking to create an inclusive financial product that allowed us to bring impact enterprises in emerging markets into the financial market. We were creating finance to make it work for the 99%. 

Since WLB1 in 2017, the WLB Series has raised over US$128 million from global investors across five issuances. Each issuance has increased in size and channeled capital into diversified multi-continent, multi-sector portfolios that have yielded a zero-default rate and are creating a positive impact in the lives of over a million women and their families. 

orange table
The metaphor of "building your own table and offering everyone a seat" epitomizes the ethos of Orange Bonds

Through the WLB Series, women in underserved communities are connected to financial markets. This empowerment extends beyond individuals, benefiting society through the skills and contributions of these empowered women. The WLB Series demonstrates that finance for the 99% can be sustainable and transformative. WLB 5 closed in December 2022, raised $50 million, and is the world’s first Orange Bond. At US$100 million, WLB6 is due to come out before the end of the year.  

The dawn of Orange Bonds: catalyzing change 

As a new asset class, the Orange Bond aims to use the bond market to accelerate gender equality and leverage empowerment for positive climate action. At the heart of Orange Bonds lie the United Nations’ Sustainable Development Goals (SDGs), which offer a powerful framework for reshaping our world. Orange Bonds are so named for the color of SDG 5, Gender Equality. With the emergence of Orange Bond issuances and the support of international organizations and development banks, the orange movement is rapidly gaining momentum.  

Channeling this momentum is the Orange Bond Initiative (OBI), initiated by IIX on International Women’s Day 2022. The OBI endeavors to mobilize $10 billion in capital and empower 100 million women, girls, and gender minorities by 2030. It represents a pivotal moment in pursuing gender equality and intersectional action – particularly climate change. An estimated 75,000 individuals from around200 companies have signed the Orange Bond Pledge, an acknowledgement of the urgency of accelerating gender equality and taking intersectional action.  

In the Orange Bond movement, transparency and impact measurement are paramount, ensuring the proceeds are utilized to address the orange impact effectively. To overcome these challenges, we set up IIX Values, a data-powered technology platform that facilitates measuring, monitoring, and managing social and environmental impact and risks until the last mile. 

This balances the traditional finance equation of risk and return, introducing a third pillar – impact. This progressive Risk-Return-Impact (RRI) model is demonstrated by the WLB Series, which has posted a strong financial performance while meeting or exceeding all impact performance targets.  

Building a new table: the power of inclusion 

The financial system has long been plagued by exclusion and a disregard for the needs of marginalized communities. The metaphor of “building your own table and offering everyone a seat” epitomizes the ethos of Orange Bonds. By embracing diversity, intersectionality, and inclusion, Orange Bonds empower underrepresented entrepreneurs, particularly women-led businesses and impact enterprises. Inspired by the vision of a future where economic prosperity is intertwined with social and environmental well-being, the orange movement seeks to create a financial system that celebrates diversity, the delicate balance of life, and equal opportunities for all. As we build our own table and extend an invitation to everyone, we can reshape the financial landscape. Orange Bonds embody this spirit of audacity, of defiance, challenging traditional norms, and paving the way for a new era in finance. 

As individuals, investors, and institutions, we have a choice. We can either perpetuate the existing systems of exclusion and inequality or embrace the defiant optimism of Orange Bonds and actively participate in reshaping the financial landscape for the better. The future of financial inclusion lies in our hands, and by embracing the principles of diversity, inclusion, and sustainable impact, we can create a thriving future where everyone has the opportunity to succeed. Let us unite in this journey and unleash the power of Orange Bonds to build a better world for all. 


Durreen Shahnaz

Durreen Shahnaz

Founder and Chief Executive of Impact Investment Exchange (IIX)

Durreen Shahnaz, a Bangladeshi American entrepreneur, is Founder and Chief Executive of Impact Investment Exchange (IIX). A global leader in sustainable finance and impact investing, she is a 2017 Oslo Business for Peace Award Honoree, a financial rainmaker in Forbes 50 Over 50, and an Asia Society Game Changer Awardee. She is also the author of The Defiant Optimist: Daring to Fight Global Inequality, Reinvent Finance, and Invest in Women , which launched globally in June 2023.


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