Goldman Sachs invests $2 billion in Black women-owned businesses

The Goldman Sachs Group announced this month that One Million Black Women has deployed $2.1 billion in investment capital and over $23 million in philanthropic capital to 137 organisations, companies and projects across the country, in an attempt to drive economic empowerment for women.

One Million Black Women is an initiative launched in 2021 by Goldman Sachs, with the goal of empowering women in business and impacting one million Black women across the US by 2030.

Despite the fact that recent analysis suggests there is a prevalent gender pay gap and an ethnic wage gap at Goldman Sachs, the global financial institution said it would commit $10 billion in investment capital and $100 million in philanthropic with a key focus on providing resources and tools to provide capital.

In the two years since its launch, One Million Black Women – in partnership with Black women-led organisations, financial institutions and diverse partners – has laid the groundwork to positively impact the lives of over 215,000 Black women across the US.

"Goldman Sachs is sending a powerful signal into the marketplace around Black women and saying there has been a misalignment of capital, in terms of capital dedicated to this group. We're seeking to change that by putting our capital where our mouth is," Asahi Pompey, global head of corporate engagement and president of the Goldman Sachs Foundation, told CNBC in an interview.

Pompey further said: "Turbo boosting Black women entrepreneurs is a key part of the work that we do. We know they create jobs. When a Black woman entrepreneur is able to grow her business, she employs Black people in the community, she's a leader in that community, and she mentors individuals in that community. The ripple effect of investing in a Black woman entrepreneur is tremendous."

On the 3rd of April, the group held an advisory council meeting which included the Obama Foundation CEO Valerie Jarret, and other organisations such as Walgreens Boots Alliance CEO Roz Brewer, former secretary of state Condoleezza Rice, actress and producer Issa Rae and National Urban League President Marc Morial, where they announced the $2.1 billion deployment of $23 million in philanthropic capital that will impact an estimated 215,000 Black women in business.

"The past two years have confirmed a key insight of our research: By investing in businesses that help Black women advance, we can build a stronger economy for everyone," said David Solomon, Chairman and CEO of Goldman Sachs in a statement.

He continues, "Our firm has a long history of supporting economic empowerment, and we're proud that One Million Black Women is already making a difference."

Investing in Black women is part of a wider approach to closing the racial wealth gap, an issue which according to economists can be ended by the economic advancement of Black women. According to statistics from the Federal Reserve Bank of Minneapolis, the racial wealth gap has been stagnant for the last 40 years.

In a survey, The Hamilton Project found that white Americans hold 84 per cent of the US wealth, but make up only 60 per cent, while Black Americans hold 4 per cent of the wealth and makeup only 13 per cent.

Over the last two years, Goldman Sachs heard from 20,000 Black women across the country, discussing and gaining insight into some of the specific obstacles they face such as healthcare, workforce development, education, affordable housing, financial health and access to capital.

The program has so far impacted 137 organisations, companies and projects, contributing to the initiative's goal of reaching one million Back women across the country by 2030.

One Million Black Women is hailed as a transformative way of ensuring a long-term systemic change in America's racial wealth gap and ensuring Black women – one of the most vulnerable demographics – are given an opportunity in an already male-centred industry.