ENHANCING WOMEN EMPOWERMENT AND THE GENDER BALANCE

30Nov 2018
Correspondent
The Guardian
ENHANCING WOMEN EMPOWERMENT AND THE GENDER BALANCE
  • Gender equality is both a moral and economic imperative. Closing the gender gap must be a central part of any strategy to create more sustainable and inclusive economies and societies.

It is about fairness and equity, the realization of individual aspirations, economic empowerment around the nation and growth.

 

 

 

Greater educational attainment has accounted for about half of the economic growth in some countries in the past 50 years

–and that owes a lot to bringing more girls to higher levels of education and achieving greater gender equality in educational attainment.

 

This feature provides a comprehensive overview and analysis based on global evidence to support the hypothesis that enhancing women’s economic empowerment by improving entrepreneurship and leadership could contribute to economic growth, job creation and prosperity.

 

It includes policy analysis and best practices/solutions from other developing countries to support the main argument.  Greater education participation, from an early age onwards, provides better economic opportunities for women by raising the overall level of human capital and labour productivity.

Mobilizing hitherto underutilized labour supply and ensuring higher female employment will widen the base of taxpayers and contributors to social protection systems which will come under increasing pressure due to population ageing.

More gender diversity will help promote innovation and competitiveness in business. Greater economic empowerment of women and greater gender equality in leadership are key components of the nation’s wider gender initiative to develop policies for stronger, better and fairer growth.

Achieving greater gender equality remains a big challenge notwithstanding the important gains that have been made in women’s education and employment outcomes in recent history.

 

Most of developing countries in Africa have achieved gender parity in education attainment, but women remain severely under-represented in key, growth-enhancing fields of education such as science, technology, engineering and mathematics (STEM).

 

Labour markets exhibit many “gender gaps”.  Women are less likely to work for pay, and are more likely to have lower hourly earnings, do more unpaid housework than men and in general the gender gaps of disadvantage in the labour market are more pronounced in the African region than across elsewhere.

 

Given this backdrop, it is no surprise that women’s position in business leadership and entrepreneurship needs to be strengthened.

 

Fostering entrepreneurship is a key policy goal for the government of any country which shares the expectation that high rates of entrepreneurial activity will bring sustained job creation and boost the development of new products, processes, and organizational innovation.

Public policies to promote female entrepreneurship include: fostering a gender neutral legal framework for business, reducing administrative burdens on firms and excessive regulatory restrictions.

While ensuring equal access to finance for female and male entrepreneurs, and pair relevant financing schemes with support measures such as financial literacy, training, mentoring, coaching and consultancy services, and increased access to support networks, including professional advice on legal and fiscal matters.

There is a clear need to provide more and better information about entrepreneurship as an attractive career option, both for young women in school and for women outside the labour force who are considering starting or getting back into work.

 

Policies for female-owned enterprises should not exclusively target start-ups and small enterprises, but include instruments to stimulate high-growth firms as well as growth and development in medium-sized and larger businesses.

 

Sometimes, such policies could be focused on a particular sector, for example, support programs that target female-owned enterprises in high-tech sectors.

 

There is increasing recognition of the business case for having more women in business and at more senior levels. The general arguments for more women on boards seem apparent.

 

They include larger talent pool, better representation of diverse experiences and competencies that may also help to improve governance of companies, and a better understanding of consumer needs.

 

However, findings in the literature are ambiguous and there is no conclusive scientific evidence on the impact of more gender balanced boards on company performance.

 

A firm can do much itself to empower women and a range of good practices are emerging. In practice, much will depend on the commitment of senior and middle management to driving the necessary change.

 

Good management practices will make managers accountable for the gender balance of the company workforce thereby integrating diversity in the firm’s decision making process.

 

Women constitute an important part of the labour force, but they remain under- represented in the labour force. Despite the potential benefits that firms can derive from giving women a more prominent role (see below), they remain under-represented in the business sector in most countries.

 

The underrepresentation of women in the workforce and in business leadership in some countries is also related to large differences in the fields of study chosen by young men and women.

 

Women are more likely to obtain degrees in health and the humanities, but are underrepresented among students and graduates of degrees in the so-called STEM fields of study {Science, Technology, Engineering and Mathematics}.

 

Graduates with degrees in STEM areas are in demand in the labour market–and are often amongst the best paid workers–and increasing the pool of women graduating in these areas can be critical to both women economic empowerment as well as the development of the economy.

 

Innovation can benefit from a concentration of individuals with STEM skills. With an increasingly knowledge-driven (global) economy and competition in the speed of innovation governments should prioritize the development and full use of a population’s available set of skills.

At present, there are considerable gender differences in field of study, but these differences seem larger than what might be expected on the basis of student performance at age15/16: attitudes play a key role in shaping education choices.

 

It is therefore important that mathematics and science are taught in contexts that are interesting to boys and girls, and a positive attitude towards a subject is also related to positive teacher-student relations.  It thus pays to have highly qualified teachers who address gender-specific attitudes within the classroom.

 

The motivations leading women to start a business are often different from those of men. Women, more than men, start their ventures for non-pecuniary reasons, such as satisfaction with their work, the possibility of making a difference in their community, or the search for a good balance between work and family life.

                 

This last motive is particularly relevant for women, as self-employment offers more flexibility to combine family and work. More women than men start a business out of “necessity”, becoming entrepreneurs because they do not see other options for entering the labour market.

 

The relatively high rates of women entrepreneurship in emerging and developing economies are primarily due to high levels of “necessity entrepreneurship.”

 

It is often argued that women have more trouble accessing credit than men. Indeed, the evidence shows that relatively more male than female entrepreneurs make use of bank loans, with or without collateral, to start their enterprises.

 

Women also tend to raise smaller amounts of capital also when it comes to financing business expansion. Moreover, they rely more heavily on internal than on external sources of capital.

 

The lower use of outside financing can deprive women-owned enterprises of the capital needed to innovate, develop new products and services, hire key employees, and grow.

 

It is important to distinguish demand-side (lower preferences for external financing and debt) and supply-side (more difficult access) explanations for the financing gap of women-led firms.

 

On the demand-side, female owners traditionally operate in sectors at lower capital intensity and at a lower scale: this partly explains their lower propensity to seek external funding.

 

A study in Australia found that women were highly concerned by the issue of “keeping control” of their business, and is thus less attracted by equity financing.

 

 Another glaring evidence from the United States shows that women are more likely to be discouraged from applying for loans for fear of rejection, though they are no more likely to be denied when they do apply.

 

This lower confidence is partly driven by lack of familiarity with finance and accounting practices. Whatever the case; there are press reports that women are discriminated against in financial markets, being more likely to be denied loans, or to be asked for additional guarantees whilst facing higher interest rates.

However, lending discrimination is very hard to prove, and there is only scattered evidence that it is a common practice in almost all countries.

In most countries, the earning gap in self-employment has not changed substantially over the last five years .The gap narrows, however, when calculated on the basis of earnings per hour worked, as women tend to work significantly less time on their businesses.

There is also less disparity when only the self-employed with employees are considered. To enhance women empowerment and the gender balance in leadership and entrepreneurship it is essential to make a compelling evidence-based business case.

 

There are several reasons why businesses should be –and increasingly are–interested in enhancing the role of women in their companies and why policy makers want to release the untapped potential of women entrepreneurship.

                                            

Such reasons include: a) to attract and retain the best talent; b) to better serve consumer markets, including those in which women are the main customers; c) to enhance diversity and improve overall performance in the workplace and economy; and d) to address future demographic change.

 

Many companies also focus on changing human resources practices in recruitment, promotion, remuneration, flexible work, mobility, and re-entry in order to remove potential biases against women.

 

Such action can involve training recruiters and managers in the importance of diversity, and improving the female focus of recruitment campaigns or quotas in lists of top management candidates.

 

Companies may also introduce family-friendly workplace supports to attract and retain staff, and reduce turnover. Evidence on the direct financial benefits of such policies is scarce  but neither do they hurt financial performance and may deliver other positive results, such as make the firm a more attractive place to work for staff at all levels.  ENDS.

 

 

                      

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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