Isobel Coleman - Global Glass Ceiling

8/13/2019 Isobel Coleman - Global Glass Ceiling

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Over the last several decades, it hasbecome accepted wisdom that improving

the status of women is one of the mostcritical levers of international development.When women are educated and can earnand control income, a number of goodresults follow: infant mortality declines,child health and nutrition improve, agri-cultural productivity rises, populationgrowth slows, economies expand, andcycles of poverty are broken.

But the challenges remain dauntinglylarge. In the Middle East, South Asia, andsub-Saharan Africa, in particular, largeand persistent gender gaps in access toeducation, health care, technology, andincomeplus a lack of basic rightsand pervasive violence against womenkeep women from being fully productivemembers of society. Entrenched genderdiscrimination remains a defining charac-

teristic of life for the majority of the worldsbottom two billion people, helping sustain

the gulf between the most destitute andeveryone else who shares this planet.

Narrowing that gulf demands morethan the interest of the foreign aid andhuman rights communities, which, to date,have carried out the heavy lifting ofwomens empowerment in developingcountries, funding projects such as schoolsfor girls and microfinance for femaleentrepreneurs. It requires the involvementof the worlds largest companies. Notonly does the global private sector havevastly more money than governmentsand nongovernmental organizations, butit can wield significant leverage with itspowerful brands and by extending promisesof investment and employment. Somecompanies already promote initiativesfocused on women as part of their corpo-rate social-responsibility programsinother words, to burnish their images as

good corporate citizens. But the trulytransformative shiftboth for global

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The Global Glass Ceiling

Why Empowering Women Is Good for Business

Isobel Coleman

Isobel Coleman is Senior Fellow for U.S. Foreign Policy and Directorof the Women and Foreign Policy Program at the Council on ForeignRelations. She is the author of Paradise Beneath Her Feet: How Women AreTransforming the Middle East. For an annotated guide to this topic, seeWhat to Read on Gender and Foreign Policy at www.foreignaairs.com/

readinglists/gender.


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[ 14] foreign affairs. Volume89 No.3

Isobel Coleman

corporations and for women worldwidewill occur when companies understandthat empowering women in developingeconomies aects their bottom lines.

The majority of global population

growth in the coming decades will occur inthose countries where gender disparitiesare the greatest and where conservativereligious traditions and tribal customswork against womens rights. As multi-national corporations search for growth inthe developing world, they are beginningto realize that womens disempowermentcauses staggering and deeply pernicious

losses in productivity, economic activity,and human capital. Just as many corpora-tions have found that adopting environ-mentally sensitive business practices is notonly good public relations but also goodbusiness, companies that embrace femaleempowerment will see their labor forcesbecome more productive, the quality oftheir global supply chains improve, andtheir customer bases expand. They willalso help drive what could be the greatestcultural shift of the twenty-first century.

BENEFITS PACKAGE

In 2006, General Electric was facing agrowing disaster. Its ultrasound tech-nology had spread to India, and Indianhuman rights groups and gender activistsbegan to accuse the company of being

complicit in female feticide. This was aburgeoning public relations nightmarethat also threatened ges profitable Indianultrasound business.

In India, as in many other countriesin South and East Asia, the heavy burdenof dowry payments and/or patriarchaltraditions make parents prefer male chil-dren to female ones. The spread of ges

portable sonogram machines to clinics

across rural India brought low-cost fetalsex screening to millionswhich meantthat parents could now easily abortunwanted girls. Although in 1994 theIndian government passed a law prohibit-

ing sex-selective abortion, the problempersists. In some parts of the country, asmany as 140 boys are born for every 100girls. Comparing the cost of an abortionto a future dowry, abortion clinics lurecustomers with advertisements warningthat it is better to pay 500 rupees now,save 50,000 rupees later. Because abor-tion providers have continued to flout the

1994 law, in 2002 the Indian governmentamended it to make the manufacturersand distributors of sonogram equipmentresponsible for preventing female feticide.

To protect its ultrasound business andavoid legal damages, ge created a series oftraining programs, sales-screening proce-dures, and post-sale auditing processesdesigned to detect misuse, and it also putwarning labels on its equipment. Nonethe-less, gewas caught o-guard by the mediacampaign launched by Indian activists,who accused it of enabling female feticide.Before long,ge realized that if it hopedto continue to dominate the countrysultrasound market, it would have to con-front the low status of women in Indiansociety. It met with activist groups andlaunched a poster campaign to change

attitudes about womens rights. At the sametime, it began to fund education for girlsand to sponsor a hip, young Indian femaletennis star as a progressive role model.

As often happens when the privatesector gets involved in the touchy subjectof womens rights in the developing world,the case of ge in India was disappointinglyreactive. Too often, companies act only

after they face a public relations problem,


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whether being charged with femalefeticide or with hiring underage girls insweatshops. Perhaps it is not surprisingthat multinational companies tend toapproach the topic gingerly and belatedly,

given the cultural sensitivities regardingwomen in many emerging markets and thefact that the senior management of localsubsidiaries is often overwhelmingly male.

Slowly, however, attitudes are begin-ning to change. Partly in response toshareholder demands, some companies arebecoming increasingly proactive regard-ing womens empowerment. In addition,

investors have put more than $2 trillioninto socially responsible investment funds,which weigh both financial returns andsocietal impact. Although supportingwomens rights is not yet a primary con-cern of most such funds, it is becomingan increasingly high-profile componentof the larger social justice agenda thatdictates how and where socially responsi-ble investment funds invest. Meanwhile,the rise of female senior managers, boardmembers, and ceos in Western compa-nies is also raising the profile of womensrights in the global corporate agenda.

Nike is one company that has decidedto take a proactive approach to womensempowerment. Having been regularly hitin the 1990s with accusations of relyingon sweatshop labor abroad, Nike instituted

an elaborate inspection system to rootout the worst labor practices among itssuppliers. Along the way, it realized thatmany of its overseas factories were over-whelmingly staed with female workers,meaning that the problems of oppressedgirls and womenincluding a lack ofeducation and access to health care, childmarriage, vulnerability to hiv/aids, human

tracking, and domestic violencewere

its problems, too. In 2004, the companycreated the Nike Foundation, which investsin health, education, and leadership pro-grams for adolescent girls in the develop-ing world. So far, it has distributed close

to $100 million. Perhaps more important,Nike has deployed its powerful brand andmarketing skills in support of young girls.In 2008, it launched The Girl Effect, adramatic, smartly produced video thathas since gone viral on the Internet.

In 2008, Goldman Sachs put its ownrecognizable brand and considerableresources behind female empowerment

when it launched a program called 10,000Women, a five-year, $100 million globalinitiative to invest in business and man-agement education for female entrepreneursin developing countries. The initiativehelps make up for the lack of businesseducation available to women in thedeveloping world: in all of Africa, forexample, there are fewer than 3,000women enrolled in local mba courses.Goldman touts the program on the eco-nomic grounds that closing employmentgender gaps in emerging markets stimu-lates growth. The companysceo, LloydBlankfein, says that the program is a wayof manufacturing global gnp, which,in the long run, is good for Goldman.Early assessments in the press indicatethat graduates of the program have seen

increases in the revenues of their busi-nesses and have hired more employees,thus growing local gnp and raising theeconomic stature of women. The 10,000Women program is also funding newteachers and curricula to educate futuregenerations of female entrepreneurs inAfrica, Asia, Latin America, and theMiddle East. Just as governments and

international development organizations


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have realized that empowering womenis much more than a human rights issue,leaders in the private sector, such asGoldman Sachs and Nike, are startingto understand that enhancing womens

economic power is good business.

WORKING GIRLS

A 2009 McKinsey survey of corporationswith operations in emerging marketsrevealed that less than 20 percent of thecompanies had any initiatives focusedon women. Their executives have simplynot made the issue a strategic priority.

Perhaps they should reconsider. Accord-ing to the same study, three-quarters ofthose companies with specific initiativesto empower women in developing coun-tries reported that their investments werealready increasing their profits or thatthey expected them to do so soon. Suchinvestments pay o by improving acompanys talent pool and increasingemployee productivity and retention.Corporations also benefit as new marketsare created and existing ones expand. Inthe developing world especially, networksof female entrepreneurs are becomingincreasingly important sales channels inplaces where the scarcity of roads andstores makes it dicult to distributegoods and services.

One example of how a corporation

can simultaneously expand its business andempower women is Hindustan Unilever,Indias largest consumer goods company.It launched its Shakti Entrepreneur Pro-gram in 2000 to oer microcredit grantsto rural women who become door-to-doordistributors of the companys householdproducts. This sales network has now ex-panded to include nearly 50,000 women

selling to more than three million homes

across 100,000 Indian villages. Not onlydo these women benefit from higherself-esteem and greater status within theirfamilies, but they invest their incomes inthe health, nutrition, and education of

their children, thereby helping lift theircommunities out of poverty. HindustanUnilever, for its part, was able to open upa previously inaccessible market.

Training women as local distributors ofgoods and services is important, of course,but so is incorporating women-ownedbusinesses into global supply chains.As giant retailers such as Walmart and

Carrefour move aggressively into emerg-ing markets, they are trying to buy moreof their products, particularly food, directlyfrom local producersboth to lowerprices and to improve quality. With morethan $400 billion in annual sales, Walmartis the worlds largest retailer, so its pur-chasing decisions have a cascading eectthroughout the global supply chain. Itsrecent sensitivity to environmental issues,for example, is starting to transformhow companies around the world producegoods. This February, it announced aplan to reduce the greenhouse gas emissionsproduced by its global supply chain by20 million metric tons within five years;it plans to do this by forcing its suppliersto adjust how they source, manufacture,package, and transport their products.

Similarly, there are signs that Walmartis beginning to understand the importanceof womens empowerment in the develop-ing world, where it projects that most of itsfuture growth will take place. Since almost75 percent of its employees are women,the company has a clear interest in pro-moting womens economic empowermentin its new markets. Working alongside

care, a humanitarian organization that


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combats global poverty, Walmart haslaunched several pilot programs to teachliteracy and workplace skills in the devel-oping world. In Peru, it is helping femalefarmers meet the companys quality-control

standards. In Bangladesh, it is traininglocal women in the garment industry tomove up from fabric sorters to seamstressesand cutters. Similarly, it is developing theskills of female cashew farmers in Indiaso that they can progress from low-levelpickers to high-end processors. Walmartexpects to see increased productivity, higherquality, and greater diversity in its supply

chain as a result. We arent engaging withWalmart solely for the financial resourcesthey bring to the table, says Helene Gayle,president and ceo of care. We are work-ing together to make change on a globallevel. Walmart has enormous potential totransform womens lives in the emergingmarkets in which it operates.

It is ironic, of course, that Walmartis embracing womens empowerment inemerging markets even as it fights thelargest class-action sex-discriminationlawsuit in U.S. history. (Walmart is accusedof discriminating against women in payand promotions.) Undoubtedly, itswomens empowerment initiatives couldhave multiple motivations, includingdiverting negative public attention. ButWalmarts eorts will be sustainable only

to the extent that the company considersthem central to its long-term growth andprofitability and not just part of a publicrelations strategy. The potential for itsfemale employees and suppliers in thedeveloping world is enormous: if Walmartsourced just one percent of its sales fromwomen-owned businesses, it wouldchannel billions of dollars toward womens

economic empowermentfar more than

what international development agenciescould ever muster for such eorts.

Interestingly, one organization thatseems to understand the power of usingits supply chain to further womens eco-

nomic empowerment is the U.S. military.In Afghanistan, the United States hasmade strengthening the role of womenin Afghan society a central element of itscounterinsurgency strategy. To this end,the U.S. military is experimenting withsetting aside some contracts for Afghanwomen entrepreneurs to supply uniformsfor the national police and army. Initial

results in the fall of 2009 were disastrous,however: proposals came back withmistakes and with product samples inthe wrong color, fabric, and sizes. Inresponse, the U.S. military has heldseveral training courses to educate Afghanbusinesswomen on how to meet qualitystandards and navigate the complicatedrequest for proposal process. It is too earlyto tell if any women-owned companieswill be able to fill large military ordersthe minimum is for $300,000 worth ofgoodsbut according to news reports,the women who have participated in theprogram say that the experience has beeninvaluable.

ATTITUDE ADJUSTMENT

Companies that are interested in womens

empowermentwhether driven by cor-porate social responsibility or by businessstrategynow have more tools and sup-port available to guide their investmentsthan ever before. The World Bank is oneexample of an institution that is partner-ing with private-sector firms in thiseort. For two decades, economists atthe World Bank have been making the

case that girls education and womens


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Isobel Coleman

economic empowerment are among thebest investments that the developed worldcan make to reduce poverty and stimulategrowth in the developing world. AsRobert Zoellick, president of the World

Bank, frequently says, Gender equalityis smart economics. The World BanksGender Action Plan invests in infrastruc-ture in the developing world, in areassuch as energy, transportation, agriculture,water, and sanitation, in ways that arespecifically focused on promoting womenseconomic empowerment. But the plan isshort on resources, with only $60 million

in funding over four years. Not surprisingly,then, the World Bank is looking for otherways to steer funding toward women inthe developing world. In April 2008, itlaunched the Global Private Sector LeadersForum to engage corporate executivesin developing countries. Already, the23 member companies in the forum andthe World Bank itself have committed tospending $3 billion on goods and servicesfrom women-owned businesses over thenext three years. Initially, much of thisprocurement will take place in developedeconomies, where women-owned businessare more established and and the com-mitments are easier to track. But theseconditions are beginning to change, thanksto organizations such as WEConnectInternational, which certifies the opera-

tions of women-owned businesses in thedeveloping world according to interna-tional standards. Although the GlobalPrivate Sector Leaders Forum is composedlargely of blue-chip companies based inthe United States, such as Boeing, Cisco,ExxonMobil, and Goldman Sachs, it alsohas a sprinkling of prominent companiesfrom emerging-market economies, such

as Egypt, India, Peru, and Turkey.

Governments in emerging-marketcountries are beginning to understandthat to be competitive, they will needto respond to the growing demands ofthe global economy regarding womens

empowerment. For example, in 2008,Morocco retracted its reservations aboutthe uns Convention on the Eliminationof All Forms of Discrimination AgainstWomenthe leading international treatyto protect womens rightspartly sothat it would become more attractive toforeign companies. Even Saudi Arabia,an oil-rich state that has rejected any in-

ternational standards on womens rights,is finding it harder to resist the demands ofthe global economy. In 2009, recognizingthat it must upgrade its educational systemto produce enough skilled professionals tofuel growth, it opened a new $10 billionuniversity for science and technologyand, for the first time in the countryshistory, enrolled women alongside men.

THE FIVE-POINT PLAN

Five principles should guide the eorts ofthose corporations that are just now begin-ning to consider womens empowermentas a strategic aspect of their emerging-market operations.

First, success must be defined andmeasured appropriately. Success cannot bereduced to the types of metrics now famil-

iar in Western corporate suites, such as howmany women are in senior managementpositions. Instead, corporations musttrack the most basic information abouttheir female employees, suppliers, andcustomers in emerging markets. Forexample, do their female employees haveaccess to financial services so that theycan actually control their incomes? Do

they have identity cards that allow them


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to be counted as citizens? Do they needa male family members permission towork? Since obstacles to female empow-erment dier across regions, companiesshould rely on local market studies and

work-force surveys to identify the relevantissues for corporate growth in each market.

Second, although donating moneyto womens empowerment initiatives is agood start, incorporating such objectivesinto actual business practices is evenbetter. Bringing female farmers into theglobal supply chain probably has the mostpotential in this regard. In sub-Saharan

Africa and South Asia, for example,although farm labor is more than 70 per-cent female, women tend to focus onsubsistence crops rather than cash crops,a sector that men still dominate. Usingwomen to increase sales also holds greatpossibility, as the experience of HindustanUnilever shows. Even sectors that employa low percentage of women, such as theextractive industries, could target women-owned businesses for support services,such as catering, laundry, oce cleaning,and transportation.

Third, companies should concentrateon providing skills and resources to femaleentrepreneurs and business leaders. Forsome firms, this could mean expandingtheir financial services to female clientsnot just credit but savings products, too.

Or it could take the form of supportingan existing local organization that helpswomen obtain access to health care, iden-tity cards, or property rights. Leadershiptraining, as well as secondary and univer-sity education, is central to developing thenext generation of female business leadersand managers.

Fourth, even though companies are

understandably wary of being associated

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initiative. Walmart, meanwhile, is work-ing with care in Bangladesh, where theorganization has more than 50 years ofon-the-ground experience.

Closing the gender gap and improving

womens rights in the Middle East, SouthAsia, and sub-Saharan Africa may takemany generations, but the benefits willbe hugenot only for the individualwomen and their families but also forglobal markets. As companies seek newsources of revenue in emerging economies,they will find that gender disparitiespose an obstacle to doing business. The

sooner the private sector works to over-come gender inequality, the better othe worldand companies own bot-tom lineswill be.

with controversy, they cannot denythat they have an interest in the outcomeof conflicts taking place over the role ofwomen in many developing countries.Important and growing markets, such

as Indonesia, Nigeria, and Pakistan, arehome to protracted debates between mod-erates and extremists. Such thorny subjectsas child marriage, domestic violence, andwomens access to reproductive healthmay seem o-limits to corporations. Butconsider just one example: rapid popula-tion growth in Nigeria, already Africasmost populous state, will strain the coun-

try s resources and threaten its stability,thus jeopardizing substantial Westerninvestments. Similarly, decades of researchhave shown that societies with a dispro-portionately high number of menas isthe case where families prefer male chil-dren to female onesare less stable andmore prone to violence, which hinderseconomic growth.

Fifth, corporations should not try toreinvent methods that have already beenperfected by others simply to appearinnovative and committed. Instead, theyshould look to partner with the manyexcellent nonprofit organizations thathave been working on issues of womensempowerment for decades. Organizationssuch ascare, Vital Voices, and WomensWorld Banking are eager to work with

the private sector to develop programsthat can take advantage of corporationsexpertise and assets, including their brands,employees, supplier bases, technology,and funding. Nike and ExxonMobil haveformed a number of such partnerships.Likewise, Goldman Sachs is working withmore than 70 academic institutions andnongovernmental organizations around

the world to develop its 10,000 Women

Isobel Coleman

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Isobel Coleman - Global Glass Ceiling

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