2016 Taipei – The Economic Empowerment of Women
In order to fight against slowing global economic growth, the business community must be proactive in improving productivity. The economic empowerment of women is one key way through which this can be achieved. This increases participation in the workforce to support ageing populations, generates innovation and better-decision making through diversity and provides incentives to continue learning and contributing to society.
However, there are challenges that must be addressed such as gender bias and societal expectations, access to markets and finance and inflexible working arrangements. Large businesses should promote gender equity and consider better ways to support female employees and integrate women-owned and -operated businesses in their supply chains. In addition, in the case of women entrepreneurs, the use of digital technologies and ecommerce platforms can be effective tools to assist their growth and allow them to better engage in the global economy, improving regional productivity and economic development.
The global economy has grown rapidly over the past five decades; particularly in the 21st Century, much of this growth has been led by exceptional development in the economies of the Asia-Pacific. Increases in global population and life expectancy have assisted global GDP growth, increasing the global labour force by 50% in the last 25 years.[1] Productivity has also increased dramatically, with per-capita income tripling over the last 50 years.[2] Synchronously, international trade has grown exponentially, adding the efficiency gains of global markets and comparative advantage in production.[3] Together, these factors have led to exceptional global growth in recent history. However, the International Monetary Fund (IMF) reports that this global economic expansion is slowing, especially in the case of the developed economies. This projected decline in the rate of global growth is partly because of ageing populations, which lead to the shrinking of traditional labour markets, as well as lower capital and productivity growth in the major advanced economies. Furthermore, the failed Doha round of WTO trade negotiations has led to a rise in protectionist sentiments globally. Long-term global economic growth is therefore seen to be under threat.
To a certain degree, much of the Asia-Pacific is currently sheltered from these influences. Despite the weaker global growth prospects, the Asia-Pacific region is expected to expand by 5.3 per cent in 2016, accounting for two-thirds of global economic growth. This is mainly driven by consumption and relatively low rates of unemployment.[4] Nevertheless, the headwinds to long-term global growth identified by the IMF and World Bank,[5] will significantly impact the region in the medium- to long-term, and must be systematically addressed through improved public policy and the efforts of the business community.
In order to combat slowing growth, we must address the issue of productivity. The McKinsey Global Institute (MGI) predicts that three quarters of potential productivity growth over the next five decades will come from the broader adoption of best practices and catch-up improvements.[6] This includes conscious changes in areas such as talent management and HR practices, education and training, as well as sourcing and procurement strategies.
One significant area of potential productivity improvement is in the empowering of women to participate fully in the global economy, across all sectors and industries. Greater workforce participation by women would expand labour markets, and utilization of all available economic and social assets naturally supports economic growth. In addition, current research also demonstrates that gender diversity improves individual business performance and positively impacts profitability.[7] These benefits could combine to spur development, and combat slowing growth.
Women’s economic empowerment is defined by UN Women as the enabling of women to “participate fully in economic life across all sectors”;[8] this means the creation of an environment for women where they can make decisions of their own for their personal benefit as well as for broader society. The purpose of this empowerment is to elevate the power and autonomy of women to access employment and entrepreneurship in all forms, and to enable the full utilization of their efforts and abilities in business and society.
In 1995, proceeding the Fourth World Conference on Women, 189 participating governments signed the Beijing Declaration, a Platform for Action for women’s empowerment. This cemented global recognition of the importance of advancing women’s empowerment, and established baseline strategic objectives to assist in the development of policy and actions. The economic empowerment of women was highlighted in the Declaration, with strategic objectives defined to assist in the taking of action. Notably, the Declaration outlines objectives relating to both women’s access to employment, as well as the development of their own economic capacity. The two crucial objectives being:* Strategic Objective F2: Facilitate women’s equal access to resources, employment, markets and trade.* Strategic Objective F4: Strengthen women’s economic capacity and commercial networks.
International and domestic organisations and governments have sought to act upon these objectives. In 2010, UN Women was established as the United Nations Entity for Gender Equality and the Empowerment of Women. Economic empowerment is a key part of their mission. In collaboration with the United Nations Global Compact (UNGC), they developed the Women’s Empowerment Principles (WEPs) as a framework for businesses to help facilitate the empowerment of women. These seven principles establish best practice guidelines for firms, and identify the areas in which actions can be taken to empower women stakeholders. The WEPs CEO Statement of Support, currently signed by over 1300 businesses, is a commitment that firms may embrace to signal their application of the WEPs.
However, in addition to the development of global standards and certifications that endorse and support the economic empowerment of women in established firms, women’s business leadership and entrepreneurship is also essential to empowerment and broader gender equality, and a key way in which economic growth can be encouraged. Women-owned and -operated businesses play a significant role in the business community, and can provide additional innovation and talent that drives economic development. These businesses can be integral to global supply chains and international trade, and the facilitation of their engagement is equally important.
Assisting the progress of women’s economic empowerment is the advent of digital, mobile and internet-based technologies. Although transforming the broad dynamics of global business, e-commerce platforms and social media have given women entrepreneurs and business owners easier access to the global marketplace and have assisted in mitigating gender bias in global business. This is an area which is yet to fully develop, and may provide further mechanisms to empower women-owned and operated-businesses.
The benefits of women’s economic empowerment do not just benefit the business community as a whole; individual firms who embrace these empowerment practices also stand to gain significant advantage and enhance their financial success. The business case for women’s economic empowerment and diversity in general is multifaceted, and based in empirical research.
Most significantly, the economic empowerment of women allows a business to attract the best talent, which is critical to success in increasingly competitive markets. An organisation which is as attractive to women as it is to men will have access to the broadest talent pool, being able to source the best. The 2011 landmark Global Talent Index found that 32 percent of Asian executives were not confident that their companies would be able to attract and retain the staff they needed in the next two years.[9] These concerns have continued, with rising wages in Asia and the Pacific further confirming a growing talent shortage. The Manpower Group’s 2016-2017 Talent Shortage Survey identified that 40% of global employers reported talent shortages, a dramatic increase from 34% in 2012. Therefore, it is becoming increasingly important to engage a broad pool of potential talent at all levels of business to ensure future success.
Overall staff turnover is also reduced through the empowerment of female employees. Both women and men are more likely to remain with an organisation with a proactive climate of diversity.[10] This is primarily due to the perception of a concrete payoff for employees by staying with an organisation that is fair and equitable. Also, flexible work arrangements that accommodate the needs of women have been seen to heighten overall work engagement for all staff.[11]
In addition to talent acquisition and retention, the economic empowerment of women has been seen to enhance overall organisational performance. Diversity brings varied perspectives, produces a more holistic analysis of the issues a company faces, and leads to improved decision making. Recent studies suggest that gender equity in leadership positions lead to better corporate governance,[12] as well as leading to better financial outcomes on a range of measures. Furthermore, firms with gender diversity in all levels of their organisation are seen to outperform those with the least.[13]
The changes in firm-level policy and practice that improve opportunities and conditions for women are seen to improve the performance of all staff and have other positive externalities. For example, flexibility in working hours and arrangements, including remote work and parental leave, have also been found to positively correlate with overall work engagement, as well as assist new product development,[14] and innovation.[15]
It is likely that further positive conclusions will be drawn, but the existing business case is clear. Firm performance across varied criteria appears to be enhanced through increased support and empowerment of women. Research has revealed a vast number of positive externalities, which are significant and growing. In addition to those described above, women’s economic empowerment has also been found to improve a firm’s access to target markets, minimize legal risks,[16] and enhance firm reputation.[17]
The role of established business in supporting women is substantial, and yields net benefits to the firm, the business community and society at large. However, of equal importance is the role of women entrepreneurs and women-owned and -operated small- and medium-sized enterprises in supporting the economic empowerment of women. The ability to act upon entrepreneurial intention and to be empowered to execute commercial transactions is not only essential to women’s liberty, but also important for fostering economic growth and development.[18]
In the context of established enterprises, if women are in any way excluded from participating in the economy we are limiting the opportunities for half of the world’s population to engage in productive activities. This is exacerbated when it comes to entrepreneurship and innovation, which thrives upon new ideas and benefits greatly from diversity. According to the Global Entrepreneurship Monitor (GEM), women-owned entities in the formal sector represent approximately 37 percent of enterprises globally, and in six economies (Vietnam, Philippines, Thailand, Malaysia, Peru and Indonesia) women show equal or higher entrepreneurship rates than men.[19] Women entrepreneurs are therefore numerous, but women are more often driven to entrepreneurship by necessity,[20] and face far greater barriers to growth.[21] Furthermore, they still face great challenges in accessing knowledge, resources, finance and support networks, especially in the context of international expansion.[22]
International trade has been identified as a context in which women-owned businesses are underrepresented, and face heightened barriers to entry. Research by the United Nations Conference on Trade and Development (UNCTAD) has identified gender-based inequalities as significantly impactful on trade policy outcomes and trade performance.[23] Gender-unaware trade policies have been identified as impeding women’s access to markets, along with an inability to access to finance and limits to ownership rights as well as public and corporate procurement practices. The IMF has also found that equal access to inputs would raise the productivity of female-owned companies.[24]
In a growing climate of protectionism, it is essential to support and strengthen international trade for the benefit of global economic growth and development. Therefore, as a part of this mission, it is crucial that the business community lead change in these areas of gender equality policy and practice to better enable women-owned and –operated businesses to engage in the global economy.
Furthering change in the international business environment is the increasing role played by digital technologies in trade, particularly ecommerce platforms and social media. These tools have enabled more timely and convenient marketing, quicker financial transactions and greater supply chain visibility.[25] However, the anonymity and control that these online platforms provides has allowed women-owned and –operated businesses to more easily enter the marketplace, overcoming practical impediments and mitigating gender bias. These tools can be further improved, and businesses better educated about their potential to increase uptake and facilitate international business.
In addition to online platforms, mobile technologies also play a key role in assisting women-owned and –operated businesses, especially in the case of small- and micro-enterprises and for those operating in rural or remote areas. Mobile devises have improved connectivity and productivity, and have greatly assisted wholesale and retail businesses in the supply and management of product. Attesting to this fact, research by Deloitte suggests that a doubling of mobile data use leads to an increase in GDP per capita growth of 0.5 percent.[26] Furthermore, they also suggest that a 10 percent increase in mobile phone penetration increases Total Factor Productivity in the long-term by 4.2 percent.
Digital and mobile technologies are increasingly important for economic growth, and are a great enabler of international trade. According to the International Centre for Research on Women (ICRW), an increased use of technology helps women entrepreneurs increase their productivity, create new entrepreneurial ventures and further expand income-generating pursuits.[27]
Not only is the economic empowerment of women beneficial to economic growth and the improvement of productivity, the endorsement and promotion of these initiatives supports the objectives of CACCI. The organisation aims to “secure effective, concerted, and collective action” for the betterment of business conditions, the increase of trade and the advancement of economic growth, all of which are indisputably assisted by the full participation of women in global business. Furthermore, as CACCI aims to positively affect cooperation and coordination between Chambers of Commerce and similar associations, this cross-cutting area of focus is of mutual concern to all economies of the region, and therefore is able to successfully facilitate the constructive sharing of ideas and experiences and collaboration between member organisations.
CACCI currently supports the economic empowerment of women as a cross-cutting area of common interest, most notably through the CACCI Women’s Entrepreneurs Council (CWEC). This Council aims to discuss the challenges as well as the programs and proactive policy measures that can support women entrepreneurs in the region. CWEC’s active meetings and newsletter enables the sharing of initiatives and ideas, and encourages conversations and collaborations in this area.
CACCI has the ability to further develop work in the area of women’s economic empowerment. In particular, shaped and coordinated by the resources available, CACCI and member organisations can spearhead activities that facilitate information exchange, develop linkages with international and regional organisations, help coordinate related training programs and further related policy recommendations.
Other regional intergovernmental organizations and business communities have furthered women’s economic empowerment, and begun work programs in this area. Notably, the Asia-Pacific Economic Cooperation (APEC) has established the Policy Partnership on Women and the Economy. The also Organization of Islamic Cooperation (OIC) holds a yearly Women Conference, and has a related work program. In addition, the Indian Ocean Rim Association (IORA) has recently signed the Declaration on Gender Equality and Women’s Economic Empowerment, and has engaged the business community through their Women in Business Symposium. These initiatives and the momentum they generate can be utilised by CACCI and act to support further work in this area.
Given the established links between women’s economic empowerment and economic growth, advantages for established firms and international trade, it is important that CACCI and the business community in the region support and further the cause. It is recommended that CACCI and member organisations take the following actions:
a. Support the reduction of regulatory barriers to the participation of women in the economy, in particular equal access to resources and opportunities.
b. Recognise and promote the voluntary adoption of international women’s economic empowerment frameworks to assist businesses in accessing the benefits of supporting women stakeholders.
c. Strengthen and support the work of the CACCI Women’s Entrepreneurs Council (CWEC), engaging further in established discussions and initiatives to support women entrepreneurs.
d. Support local delivery of global and regional programs and initiatives to support women’s economic empowerment, such as the IORA Women Mean Business initiative as a model through which to engage women-owned and -operated businesses in the topics of digital technologies and international trade.
e. Undertake a mentoring and capacity-building program aimed at assisting women entrepreneurs improve on their entrepreneurial and management skills, gain access to financing, expand their markets, and learn how to use new technologies for the benefit of their business, among others.
It is essential the business community take action to support global productivity in light of slowing global economic growth. Supporting the economic empowerment of women is one way that the business community can increase the diversity and size of the labour market; enjoy positive externalities leading to increased economic performance; and, foster the creation and development of new business through encouraging women entrepreneurs. There are also a growing number of global and regional initiatives and resources that support women’s economic empowerment, and can assist in advancing initiatives towards gender equality and increased productivity.
Footnotes:
[1] World Bank Data. http://data.worldbank.org/indicator/SL.TLF.TOTL.IN?end=2014&start=1990
[2] Bloom, D., Canning, D., & Malaney, P. (2000). Population Dynamics and Economic Growth in Asia, Population and Development Review, 26, 257-290.
[3] World Trade Organization. (2015) Trends in International Trade. https://www.wto.org/english/res_e/booksp_e/wtr13-2b_e.pdf
[4] IMF (2016), “IMF Survey: Asia”, Regional Economic Outlook. http://www.imf.org/en/News/Articles/2015/09/28/04/53/socar050316b
[5] World Bank (2016). Global Growth Forecast Again Revised Lower to 2.4%. Media release. http://www.worldbank.org/en/news/feature/2016/06/07/global-growth-forecast-again-revised-lower
[6] Manyika, J. et al. (2015). Can long-term global growth be saved?, McKinsey Global Institute. http://www.mckinsey.com/global-themes/employment-and-growth/can-long-term-global-growth-be-savedx
[7] Campbell, K. & Mínguez-Vera, A. (2008), Gender Diversity in the Boardroom and Firm Financial Performance, Journal of Business Ethics, 83(3): 435-451; Richard, O. (2000), Racial Diversity, Business Strategy, and Firm Performance: A Resource-Based View, Academy of Management Journal, 43(2): 164-177.
[8] UN Women (2016), Women’s Empowerment Principles. http://www.unwomen.org/en/partnerships/businesses-and-foundations/womens-empowerment-principles
[9] Heidrick & Struggles (2011), Global Talent Index. http://www.globaltalentindex.com/
[10] Kaplan, D M, Wiley, J W, & Maertz, C P (2011), The role of calculative attachment in the relationship between diversity climate and retention, Human Resource Management, 50(2): 271-287.
[11] Timms, C. et al (2015), Flexible work arrangements, work engagement, turnover intentions and psychological health, Asia Pacific Journal of Human Resources, 53(1): 83-103.
[12] Labelle, R, Gargouri, R M and Francoeur, C (2009), Ethics, Diversity Management, and Financial Reporting Quality, Journal of Business Ethics, 93: 335-353; Nielsen, S and Huse, M (2012), The Contribution of Women on Boards of Directors: Going beyond the Surface, Corporate Governance: An International Review, 18(2): 136–148.
[13] McKinsey & Company (2010), Women Matter: Women at the top of corporations: Making it happen; McKinsey and Company (2012), Is there a payoff from top team diversity?, McKinsey Quarterly.
[14] Coenen, M. & Kok, R. (2014), Workplace flexibility and new product development performance: The role of telework and flexible work schedules, European Management Journal, 32(4): 564-576.
[15] Giannetti, C. & Madia, M. (2013), Work arrangements and firm innovation: is there any relationship?, Cambridge Journal of Economics, 40(5): 27-45.
[16] McDonald, P., Chaelesworth, S. & Graham, T. (2015), Developing a framework of effective prevention and response strategies in workplace sexual harassment, Asia Pacific Journal of Human Resources, 53(1): 41-58.
[17] Charlesworth, S, Hall, P and Probert, B (2005), Drivers and Contexts of Equal Employment Opportunity and Diversity Action in Australian Organisations, RMIT Publishing: Melbourne
[18] Naude, W. (2013), Entrepreneurship and Economic Development: Theory, Evidence and Policy, IZA. Discussion Paper No. 7507. http://ftp.iza.org/dp7507.pdf
[19] Kelley, D., Singer, S. & Herrington, M. (2016), 2015/16 Global Report, Global Entrepreneurship Monitor (GEM).
[20] Ibid.
[21] Morris, M. (2006), The Dilemma of Growth: Understanding Venture Size Choices of Women Entrepreneurs, Journal of Small Business Management, 44(2): 221-224.
[22] Gundlach, S. & Sammartino, A. (2013), Australia’s Underestimated Resource: Women doing business globally, Women in Global Business and University of Melbourne.
[23] UNCTAD (2016), Trade Gender and Development – Advocating inclusive and gender-sensitive economic development on a global level, June 2016.
[24] Do, Q.-T., A. Levchenko, and C. Raddatz, 2011, Engendering Trade, World Bank Policy Research Working Paper 5777 (Washington).
[25] Dunning, J. (2013), Multinationals, Technology and Competitiveness. London: Routledge.
[26] Deloitte (2012), What is the impact of mobile telephony on economic growth?, November.
[27] Gill, K. et al. (2010), Bridging the Gender Divide: How Technology Can Advance Women Economically, ICRW Publications.
