The evidence is clear and compelling: Supporting women’s economic empowerment is one of the best investments we can make. It improves development outcomes. It strengthens the quality of policy making. And it makes good business sense to harness the potential of women as directors, executives, employees, entrepreneurs, and consumers.
Yet, in most countries, women remain seriously underrepresented as economic actors who have equal voices, choices, and opportunities with men.
Multinational companies can play a vital leadership role in helping to bridge this gender gap. They can engage more strategically with women in their core business operations and governance structures, and at every stage in their value chain. Their community investments can enable women and girls to build human capital, economic assets, and leadership capacity. And they can advocate for women’s rights and opportunities through their corporate communications and policy platforms.
Engage. Enable. Advocate. Over the past decade, a vanguard of leading companies has set ambitious goals in each of these areas. They are taking action wherever they operate around the world, even in countries where the gender gap is particularly wide and where women’s rights are particularly challenged. But progress is not happening at the scale or speed at which it needs to. The time has come for all companies to move beyond compliance-driven gender diversity programs to more aspirational and transformational initiatives that truly harness the potential of the other 50 percent.
Evidence for Investing in Women is Clear
There is growing consensus that women’s economic empowerment improves both development outcomes and business success. According to the IMF and World Bank, women’s low economic participation creates income losses of 27 percent in the Middle East and North Africa, while raising female employment and entrepreneurship to male levels could improve average income by an estimated 19 percent in South Asia, and 14 percent in Latin America, not to mention the development multipliers that result from women being able to invest more in their families’ health and education. The OECD calculates that even in developed countries, achieving gender parity in labor-force participation rates would increase GDP by 12 percent by 2030.
The story is the same in most companies and industry sectors. Studies by the International Finance Corporation and McKinsey & Co., among others, point to likely gains in business productivity, efficiency, growth, and the quality of stakeholder relationships by engaging with women more effectively at all levels of a company and in all stages along its value chain.
Despite growing evidence of the benefits of women’s economic empowerment, women remain underrepresented at almost all levels of the formal, paid workforce, although they account for most unpaid work. When they do participate in the formal sector, they continue to be paid less than men for the same jobs, even in the OECD economies where they earn on average 16 percent less.
The obstacles are multi-faceted and often context-specific. They range from lack of basic human rights and access to legal rights, to negative cultural norms and attitudes and lack of access to relevant education and training, financial services, technology, business networks and markets.
Governments have a key responsibility in overcoming these challenges. But what can multinational companies do to advance women’s economic empowerment? The following agenda for action is relevant for almost any company or industry sector:
- Engage more strategically with women in core business operations, governance structures, and corporate value chains.
- Enable women and girls to build human capital, economic assets, and leadership capacity through community investment and philanthropy programs.
- Advocate for women’s rights and opportunities through evidence-based corporate communications and policy platforms.
Many large companies have established strategies to recruit, retain and promote women as directors, executives, and employees. Some have also set ambitious goals to increase the number of women producers, suppliers, entrepreneurs, employees, distributors, retailers and consumers in their global value chains. For example:
- The Coca-Cola Company made a public commitment in 2010 to empower 5 million additional women in its global value chain by 2020. By 2013, 5by20 initiatives had been established in more than 40 countries and some 550,000 women measurably supported, ranging from smallholder farmers and artisans to distributors and retailers.
- In 2011, Walmart committed to a three-pronged strategy by 2016 to: increase sourcing from women-owned businesses; support one million women through training, especially in farms, factories and processing plants; and promote diversity and inclusion in its merchandise and professional services providers.
- Gap launched the P.A.C.E (Personal Advancement and Career Enhancement) program in 2007 to educate female garment workers in technical and social skills. This initiative is intended to enhance, not replace, the company’s ongoing efforts to improve worker rights and safety in factories.
- Rio Tinto has established clear targets for women to represent 20 percent of senior management and 40 percent of its graduate intake by 2015, and implemented programs to promote women’s empowerment in their community investment activities and in the male-dominated mining industry more broadly.
There are also encouraging examples in countries where women’s rights are seriously challenged. In Saudi Arabia, for example, GE has partnered with Saudi Aramco and Tata Consultancy Services to launch the first all-female business process services center in the country, starting with 400 graduates and aiming to engage about 3,000. In Papua New Guinea, ExxonMobil has made a strategic commitment to serve as a corporate role model and advocate for women’s empowerment. This includes recruiting and promoting women in its own management and technical teams, supporting local women leaders in business and communities, and partnering with the World Bank and others to improve national data collection and policies on gender equality.
Companies can also leverage their community investment and philanthropy programs to enable women and girls to build human capital, economic assets, and leadership capabilities.
- Goldman Sachs, for example, established the 10,000 Women initiative in 2008, to provide women entrepreneurs in developing countries with access to business training and networks. By 2013, 10,000 women from 43 countries had graduated. On average they doubled the size of their workforces and increased their revenues fivefold. In 2014, Goldman Sachs partnered with the IFC to create the Women Entrepreneurs Opportunity Fund, which aims to raise about $600 million and enable 100,000 women entrepreneurs to access capital.
- Intel is leveraging its technology expertise and philanthropy to help young women close the “gender internet gap,” in Africa, where on average 43 percent fewer women than men are online. Through the Intel She Will Connect program, the program aims to enable 5 million young African women by 2016, with digital literacy training, an online peer network, and the development of gender-relevant content.
Most companies can emulate these examples, leveraging a combination of their core business capabilities and technical expertise with philanthropic dollars and other partners to enable the economic empowerment of women.
A third area where companies can play a leadership role is by using the influence and reach of their communications and public policy platforms to advocate for women’s rights and opportunities. Some do this by commissioning research to strengthen the evidence base for women’s rights and empowerment.
A few are using their marketing budgets and communications platforms to advocate for women’s issues. And a growing number are joining forces through collective platforms such as Vital Voices, UN Women, the World Economic Forum, CARE, Women’s World Banking, the IFC’s WINvest, Catalyst, Women Thrive, the U.S. Chamber of Commerce, and the Clinton Foundation’s ‘No Ceilings’ initiative to promote women’s rights and opportunities.
Scaling Up Impact
Working both individually and collectively with others, multinational companies have the ability to help drive transformative change in supporting the economic empowerment of women.
There is a long way to go in almost all countries, but growing momentum over the past decade by leaders in business, as well as government and civil society, bodes well for the future. A future where women have equal opportunities to participate and to contribute to the progress and prosperity not only of their families and communities, but also of their economies and countries.
Jane Nelson is director of Harvard Kennedy School’s Corporate Social Responsibility Initiative, a nonresident senior fellow at the Brookings Institution and a senior associate of Cambridge University’s Institute for Sustainability Leadership.
Giving Women a Seat at the Economic Table was originally published on Ideas Lab