Main ways to include Gender-Based Violence (GBV) data in your financial risk assessments
1) What are the options?
There are two main ways to include Gender-Based Violence (GBV) data in your financial risk assessments:
- Add GBV Risk as a separate category
- Include GBV indicators within existing risk categories
💡Pro Tip: We recommend checking the section called "Understanding Material Risk of GBV for Financial Actors" and "Correlating GBV and Financial Risk" by clicking in this link in our platform. And check our help center article What Does GBV Risk Look Like in Practice for Investments?
2) Which option should I choose?
There's no right or wrong choice. Pick the one that fits best with your current financial models.
Option 1: GBV Risk as a Separate Category
In this method, you add GBV Risk (GBVR) as its own category alongside other risks:
Country Risk = (PR + OR + REPR + REGR + GBVR) / 5
Where:
- PR = Political Risk
- OR = Operational Risk
- REPR = Reputational Risk
- REGR = Regulatory Risk
- GBVR = GBV Risk
Option 2: GBV Indicators Within Existing Categories
This method adds GBV indicators to each risk category:
Country Risk = (PR + OR + REPR + REGR) / 4
In this case, each risk category (PR, OR, REPR, REGR) includes relevant GBV indicators.
3) Understanding GBV Risk Levels
Our system categorizes GBV risk into four levels:
- 🟡Yellow: Ubiquitous (widespread) risk
- 🟠Orange: Significant risk
- 🔶Dark Orange: Severe risk
- 🔴Red: Extreme risk
💡These levels can help you make investment decisions and plan how to address GBV as part of your investment strategy.
👉 Check the expanded explanation on GBV Risk Levels by clicking here on this article, section 3.
Need more details? Check out this link to learn how we calculate the GBV Risk Score (GBVR) and what each risk level means.
4) Should I Include GBV Risk in my Financial Models?
To decide if you should integrate Gender-Based Violence (GBV) Risk into your financial models, ask yourself these two key questions:
1) Is GBV a significant risk to our investments? 2) Would our models be less accurate without GBV data?
If you answer "Yes" to both:
- Choose between using the GBV Risk Score (GBVR) or specific GBV indicators
- Apply your choice to your existing risk model
If you answer "No" to either question: Take a step back and evaluate:
- Does your investment team have enough expertise in gender equality and GBV?
- How much importance do you give to GBV and gender equality information when making investment decisions?
💡Remember: GBV is a widespread risk that affects all investments to some degree. Considering it in your models can lead to more accurate risk assessments and better-informed decisions📈✅
Need help to choose between GBVR and specific indicators? Check this link to "Selecting a Model to Utilize a Risk Score or Discrete Indicators" in App.equilo.io