The Business Case for Change
Over the past 10 years, the World Economic Forum’s Global Gender Gap Report has been tracking the economic gender gap across different regions of the world. Progress has been uneven and slow. A mere 3% of the global economic gender gap has been closed over that period.
In addition to a values-based case for gender equality, there is an acompanying economic imperative for including women more fully into society and the workplace. Female talent remains one of the most under-utilized business resources, either squandered through lack of progression or untapped from the onset. Although women are, on average, more educated than men globally and now participate more fully in professional and technical occupations than 10 years ago, as of today, their chances to rise to positions of leadership are only 28% of those of men. Women continue to make up less of the labour force overall than men, and where they participate in the formal economy their earnings for similar work are lower.22The talents of half the world’s potential workforce are thus often wasted or underutilized due to barriers on the path to women’s successful workforce integration
In general, women’s participation in the workforce is no longer perceived as a social issue alone, but also as a business issue—costing women, companies and ultimately entire economies. Many business leaders increasingly recognize that tackling barriers to equality can unlock new opportunities for growth. Our respondents perceive a wide range of rationales for promoting workplace gender parity, varying with the specific situation of different industries (Figure 15 and Table 11).
Overall, the most frequently cited reason for promoting female talent is the ethical imperative “fairness and equality”, which was chosen by 42% of respondents. Just over a fifth of companies are further motivated by a range of rationales more closely tied to the success of their business—enhancing innovation and decision-making or reflecting the gender composition of their customer base.
Enhanced decision-making, enhanced innovation
Across all industries, nearly one in four companies reported supporting gender parity because of an expectation that it would enhance innovation, while a similar proportion cited a related reason, enhancing decision-making. The Energy and Media, Entertainment and Information industries find these rationales particularly appealing while the Consumer and Information and Communication Technology industries do not cite them as a strong motivating factor. Employing and promoting more women is one accessible way companies can bring more diverse voices into their decision-making and business development—allowing fresh thinking and disrupting business models from within before they are disrupted from without.23Indeed, the dividends of those diverse voices are best reaped when inclusion is not predicated on pure assimilation.24Similarly, companies in which women are more strongly represented at the board and at senior management levels have been shown to outperform those where they are not.25
Reflecting gender composition of the customer base
There is a strong correlation between companies’ perception of the gender composition of their customer base and the gender composition of their workforce across various industries (Table 12). Of course, existence of this correlation does not in itself reveal the direction of that relationship; whether a more gender diverse workforce allows businesses to tap into the female client base by developing a distinctive value proposition or, inversely, whether businesses with more female clients recruit more women. Some industries are substantially more focused on this rationale than others, specifically the Professional Services, Financial Services & Investors and Consumer industries. For example, on average, just over two in five respondents from the Financial Services & Investors sector emphasize reflecting their customer base as one of their main rationales for promoting gender parity. With good reason, too: globally, women controlled 64% of household spending and 30 trillion dollars of consumer spending in 2013—and this figure is predicted to rise by almost a third over the five years to 2018.26
As women’s workforce participation rises, they will gain further purchasing power through increased lifetime disposable income. The proportion of business-to-consumer (B2C) and business-to-business (B2B) clients who are women should therefore be expected to rise, as reflected in our respondents’ projections. Most industries expect between nine and 14 percentage point growth in female B2B clients over the 2015-2020 period, particularly the Professional Services, Media, Entertainment and Information and Basic and Infrastructure sectors. Expected growth of B2C clients is lower but starting from a higher base. The Information and Communication Technology and Mobility industries expect the highest growth in their female B2C customer base, on average around six percentage points.
Expanding the talent pool and external pressures
Currently, women make up the majority of those enrolled in university in nearly 100 countries. However, “expanding the talent pool” lags behind as a perceived rationale for promoting gender parity. This may be because women’s ascendance in higher education is a relatively recent phenomenom among junior cohorts of many populations and company perceptions have not kept pace with the changing reality of the composition of the talent pool around them. Employers in the Information and Communication Technology and Mobility industries nevertheless find this rationale especially convincing. In Information and Communication Technology, a sector which struggles with talent shortages, no less than 37% of companies regard enhancing women’s workforce participation as an opportunity for expanding the talent pool. Across all industries approximately 20% of respondents also reported they were feeling external pressures to address gender imbalances, either by media scrutiny and public opinion or by government regulation.