The gender dividend: an urgent economic imperative

Managing Director, Global Public Policy, Deloitte Touche Tohmatsu Limited; Chairman, Business and Industry Advisory Committee to the OECD (BIAC)

©Luke MacGregor/Reuters

The corporate world is far from making the most out of gender diversity in the workplace. But some businesses are finding innovative ways to change this. 

The biggest issue facing most major economies today is economic growth and job creation; yet it is with mixed results that governments and business are tapping into arguably the largest emerging market in the world and the greatest natural resource for knowledge, talent and investment: women. Given the challenges facing economies, there is a strong imperative to move quickly and harness this potential. This is why BIAC enthusiastically welcomes the OECD’s initiative on gender equality.

There is a long way to go with respect to improving women’s economic opportunity, and in particular at executive leadership levels. According to current data, only 14% of senior executive positions at the Fortune 500 are held by women, a number that has barely budged since 2005. A global study of the number of women on boards is even more dismal—only 9.4% globally, up marginally from 9.2% in 2009 according to GovernanceMetrics International. This is despite the fact that economic studies show that corporations with women on their boards and in leadership positions have a higher return on equity. In Europe, the return has been estimated at more than 10%.

Furthermore, a Deloitte study citing data from the Harvard Business Review forecast the income and global spending power of women at US$18 trillion and $28 trillion respectively by 2014. Women typically spend money differently from men, with different buying patterns and preferences.

Thus, companies should invest in understanding women as consumers and fully capitalising on their purchasing power. Getting more women in the workplace, including in senior decision-making roles, who understand the buying preferences of their cohorts makes business sense.

A 2010 global survey of executives found that 72% agree that there is a direct connection between gender diversity and business success, but only 28% say it is a top-10 priority for senior leadership. Institutional investors, however, increasingly identify gender as a key determinant in their investment decisions, banking on the gender dividend in the long term.

What can be done to improve opportunity for women, which will benefit business performance, the economy and society as a whole? Focused government policy and business engagement at all levels is needed to support women at work. Sound socio-economic policies must underpin and encourage action, and governments, along with business, must innovate, support community investment and remain committed to making the difference as it relates to women.

Gender equality may be on the agenda of the G20 government leaders, but it can be argued that this should be elevated to a higher priority, given the economic and community benefits of empowering women. The OECD, a key advisory body to the G20, is undertaking an extensive project on gender equality which is rightly focusing on the “Three Es: Employment, Education and Entrepreneurship”. These elements represent key pathways for women in the economy and society in both developed and developing countries alike. The OECD analysis will help identify and develop better indicators necessary to inform key policy decisions that surround these issues. There is a lot of anecdotal evidence supporting the need and benefits to empowering women, but clear data can be a significant motivator.

Business too has a role to play. Change requires measurable, management-led policies and practices that drive female leadership, across management roles and divisions, on boards, at the highest executive levels (the C-suite) and throughout the talent and supply chains. Many companies worldwide are making significant strides in addressing not so much the glass ceiling, although this does continue to present a hurdle for many, but the stubborn problem of the leaking pipe of female talent. Retention rates for women dramatically decrease with seniority and advancement.

Business implements countless formidable approaches and statistics suggest that these seem to be making a difference. For example, Mass Career Customization™ (MCC), the brainchild of two women at Deloitte. Developed and piloted in 2004 and rolled out across the US between 2007 and 2010, MCC enables employees to collaborate with their managers to design career paths responding to their specific needs and those of the business. Not solely designed for women, but recognising women as major beneficiaries, it has improved satisfaction of Deloitte’s professionals with work-life balance, has contributed to improved retention and is correlated with employee engagement.

Another case study of the gender dividend in action is the Deloitte Initiative for the Retention and Advancement of Women (WIN). Started in 1993 at Deloitte US, its results tell the story. In 1993, women comprised only 7% of partners, but in 2011 there were more than 1,000 women partners, principles and directors, representing 23% of management, one of the highest amongst its peers. It has also changed the culture to one of where both men and women can succeed, and positively impacted the Deloitte brand. The success factors of this initiative are strong leadership from the top—five CEOs have spearheaded the initiative since it started; the positioning of WIN as a business strategy; and innovation to allow WIN to evolve and grow. When businesses far and wide recognise gender diversity as a critical business enabler and a strategic imperative, we will see even more positive developments in the economic empowerment of women.

At the end of the day, there is no silver bullet. Progress is being made, but ongoing commitment, leadership and innovation are required for economies to benefit from the tremendous potential women represent. This is not just a question of trillions of dollars of untapped consumer demand, but the potential for better, more informed decision-making in our societies, an educated and diverse source of talent for private and public institutions, and role models who can be an inspiration to billions of women and men worldwide. Government, business and society must continue to integrate women’s experiences, perspectives and voices into the fabric of their organisations and systems. Only then will we truly benefit from the gender dividend.

http://www.deloitte.com

See also: 

The OECD Gender Initiative 

Mass Career Customization™

Deloitte Initiative for Women


©OECD Yearbook 2012




Economic data

E-Newsletter

Stay up-to-date with the latest news from the OECD by signing up for our e-newsletter :

Twitter feed

Suscribe now

<b>Subscribe now!</b>

To receive your exclusive print editions delivered to you directly


Online edition
Previous editions

Don't miss

  • OECD speak on support it will offer to Greek
  • 3.4 bn people or 56% of the world's population live only just above the global poverty line, on US$2-10 a day. The global middle class is both smaller and poorer than thought. Read more about the results of this Pew Research Centre's new study on the Financial Times.
  • Resale of charity shop rejects has destroyed Kenya's local textile industry but a proposed ban on the importation of used garments risks putting thousands out of work. Read more about this economic dilemma on The Guardian.
  • Bill Gates visited the OECD on 26 June. He met with the Secretary-General Angel Gurría to discuss areas of collaboration with his foundation and participated at a briefing session on official development assistance modernisation with OECD experts.
  • "Countries that are home to high proportions of immigrants tend to have better integration outcomes”, according to the OECD Indicators of Immigrant Integration 2015, released on 2 July 2015. Read more on The Guardian.
  • The People’s Republic of China decided to enhance longstanding collaboration with the OECD and to join the OECD Development Centre, in a historic visit by Chinese Premier Li Keqiang on 1 July to the OECD in Paris.
  • In order to face global warming, Asia needs at least $40 billion per year, derived from both the public and private sector. Read how to bridge the climate financing gap on the Asian Bank of Development's website.
  • One dollar in aid for trade generates eight dollars in extra trade for all developing countries and 20 dollars for low-income countries. Read OECD Secretary General's post on the newly released Aid for Trade at a glance 2015.
  • In the US, many part-time workers were left behind by the economic recovery. The vast majority of the nation’s 26 million part-time workers receive no benefits beyond their paychecks and almost one-third say their financial condition is flat out poor. A Market Watch article.
  • Where in the world are you most likely to be working too much—or napping? Read the results on Quartz.
  • Catherine Mann, OECD Chief Economist, explains on Bloomberg why "too much bank lending can slow economic growth".
  • Interested in a career in Paris at the OECD? The OECD is a major international organisation, with a mission to build better policies for better lives. With our hub based in one of the world's global cities and offices across continents, find out more at www.oecd.org/careers .
  • Come va la vita in Italia? How's life in Italy? The OECD Better Life Index is an interactive online platform in seven languages that goes beyond GDP by offering important insights into measuring well-being and quality of life. Try it for yourself!
  • Millions of refugees have been condemned to a life of misery in the worst displacement crisis since the second world war, according to Amnesty International. Read more on The Guardian.
  • What does it mean to live on less than US$2 a day? Xavier Godinot, Delegate for International Affairs of ATD 4th World and René Locqueneux, a member of this NGO, gave an insightful presentation on the topic based on their field experience, at the 2015 OECD Forum.
  • How to jump-start slack investment to drive global growth and jobs dominated discussions at the annual OECD Ministerial Council Meeting, chaired by the Netherlands, which ended 4 June.
  • The IMF calls for a decisive energy subsidy reform in order to use the freed resources to meet critical public spending needs and to reduce pollution ahead of the Paris climate change summit.
  • More than 35 million young people, aged 16-29, across OECD countries are neither employed nor in education or training according to the newly released OECD Skills Outlook.
  • Have a look at these posters representing a world without fundamental rights at work – including child labour, forced labour and inequality. Read more about this ILO image competition here.
  • Rising inequality threatens social cohesion and growth. Income inequality has reached historical highs in most OECD countries and is still rising.
  • Time to vote! As the dust settles after the UK general election, let’s remember that voting at the ballot box is not an innate right enjoyed by everyone. Indeed, although the number of democracies across the world has spiked from 48 in 1989 up to 95 today, billions of people are still living in non-democratic, authoritarian regimes.
  • How can we achieve a zero-carbon future? A new World Bank report provides a few insights.
  • Today alcohol causes more deaths worldwide than HIV/AIDS, violence and tuberculosis combined. In order to reduce damages to health, the OECD recommends that regular drinkers reduce their consumption by one unit a week, that is, a small glass of wine for example. In addition, increasing prices, regulating advertising, effectively treating drinking problems together with stricter police enforcement would greatly contribute to reducing damages done to individuals and society.
  • video alcohol
  • Africa vs profit shifting African countries heavily rely on the income generated by multinationals’ taxation, which can represent as much as 88% of a country’s tax base. Little wonder Africa is involved in the OECD’s initiative to address tax base erosion caused by profit shifting, known as BEPS. The need to strengthen inter-governmental co-operation to curb cross-border tax losses was reaffirmed at the Africa Tax Administration Forum (ATAF) in Sandton on 21 April 2015.
  • Africa v. profit shifting
  • Rana Plaza
  • Wal-Mart, Other Retailers Sued over Bangladesh Factory Collapse Two years after the April 24, 2013, Bangladeshi factory collapse in the capital of Dhaka, the victims' families filed a lawsuit in U.S. federal court in Washington against Wal-Mart Stores Inc and other U.S.-based companies that sourced out their products from the Rana factory. Read more on Telesur's website.
  • Today, after three years of drought, California is in the midst of a full-blown political and environmental crisis, with restrictions imposed across the state, reports the Financial Times.
  • Lack of water holding back Asian growth In Asia, the world’s most dynamic region with the fastest economic growth, 75% of countries face serious water shortages.
  • ADB water
  • Why is the gap between rich and poor growing despite rises in GDP? Do benefits help? Does aid work? (The Guardian)
  • Greek finance minister Yanis Varoufakis expressed its scepticism towards the Eurozone’s institutions and gave ideas for ways forward. "Greece must become reformable again", Yanis Varoufakis said.
  • Business brief: Israel's water
  • #OECD360: Your country in figures.
  • How to ensure transparency in public procurement? Read Cobus de Swardt's article on OECD Insights.
  • Asia to maintain a strong 6.3% growth rate in 2015 and 2016, according to the Asian Development Bank
  • After three decades of extraordinary economic development, China is shifting to a slower and more sustainable growth path, according to the OECD's latest Economic Survey of China.
  • In pursuit of the American Dream
  • Iceland's strong recovery stems from the good use of its natural resources, the energy sector and tourism according to Peter Dohlman, IMF Mission Chief for Iceland.
  • cyclone
  • Government representatives and experts from around the world are gathering in Japan this week to develop a post-2015 framework for global disaster risk reduction. The World Bank and the Global Facility for Disaster Reduction and Recovery (GFDRR) will share expertise at the conference.
  • Switzerland’s recent moves towards greater tax transparency were welcomed by the Global Forum on Transparency and Exchange of Information for Tax Purposes, based at the OECD, as a boost to international efforts to end tax evasion. Work will continue with Switzerland, notably on implementation, in 2015.
  • Help bridge the gap between business integrity policies & practices:participate in this new OECD survey by clicking on the image.
  • What can we do to promote better literacy skills for all? Read Andreas Schleicher's latest blog on oecdeducationtoday.
  • Secretary General Angel Gurría describes the Programme for International Student Assessment (PISA) as a useful tool to enhance educational systems but states that improving a country's ranking should not be a goal per se. Article in Spanish by El País.
  • pisa
  • [VIDEO] Although many countries have made great progress in narrowing gender gaps in education, new challenges are looming.
  • Tim Harcourt Video
  • G20 and Australia: Bestselling economist Tim Harcourt speaks to the BBC about how Australia has gone from "Down Under to Down Wonder".

Most Popular Articles

Poll

What issue are you most concerned about in 2015?

Euro crisis
Unemployment
Global warming
International conflict
Other

OECD Insights Blog

NOTE: All signed articles in the OECD Observer express the opinions of the authors
and do not necessarily represent the official views of OECD member countries.

All rights reserved. OECD 2015