The Gender Equality Reserve (GER) : Fiscal Incentives for Gender-Inclusive Capital Formation

This paper develops a theoretical framework for addressing underinvestment in gender-inclusive leadership through corporate tax policy. Drawing on optimal taxation theory, I introduce the Gender Equality Reserve (GER) -- a fiscal instrument that allows firms to deduct pre-tax investments in gender-focused organizational capital. A stylized neoclassical model demonstrates how informational frictions and externalities result in inefficiently low levels of inclusive governance. By reducing the effective cost of such investments, the GER partially internalizes their social returns and shifts firm behavior toward the social optimum. The mechanism provides both normative and efficiency-based justifications for policy design and is especially relevant for sectors undergoing institutional transformation, such as energy and technology. This analysis contributes to the literature on tax design and inclusive growth, and supports broader Sustainable Development Goals related to gender equality (SDG 5) and decent work (SDG 8).