GRACA MACHEL: Empower women and grow economies
'There is a growing body of evidence which demonstrates that when women do not reach their economic potential, the economies of their countries suffer'
Trialogue – “Business in Society Conference” – May 15, 2017
Keynote Speech by Graca Machel
“The Role of Women in the Socio-Economic Transformation of Africa”
As it stands, society at large is not benefiting from the full economic potential of women as women continue to be underrepresented in key industries and executive roles, they face barriers in entry to the formal economy, often suffer from discrimination, and experience challenges in balancing the demands of family and work life.
Additionally, the wage gap between men and women is significant and knows no borders. Research indicates that in the same or similar occupations with near identical background and experience, women still earn approximately 10% less than their male counterparts.
Empowering and educating women is a critical driver to social and economic development on the continent
There is a growing body of evidence which demonstrates that when women do not reach their economic potential, the economies of their countries suffer.
A recent McKinsey Global Institute report found that $12 trillion could be added to global GDP by 2025 by advancing women’s equality. I’m no mathematician, but the calculation is simple: without women participating in the formal economy, our economies do not grow to the extent they could or need to grow.
There are untold benefits for our continent should we really begin to seriously invest in our female employees and women entrepreneurs.
Empowering and educating women is a critical driver to social and economic development on the continent. There is untold benefit for employers to bringing on more women as a part of their workforce. Studies have shown greater access to education and participation by women in male-dominated occupations in Africa could increase worker productivity by up to 25%.
Additionally, a number of studies on teamwork and business strategy reflect that diversity in gender, race, and age of staff result in better decision-making processes and better outcomes.
Women have a unique way of humanizing the cold dynamics of business, and in addition to their core competencies, often bring much-needed “soft skills”, emotional intelligence and empathy to the workplace. It simply makes good business sense to employ women at all levels of the organizational structure.
The increased integration of women in the formal economy has a knock-on effect which elevates the status of women and her perceived value in society at large.
The ability to be in the driving seat and at the helm of decision-making processes shifts patriarchal power dynamics.
A quick scan of societies with high percentages of female participation in the economy reveals that the more influence women hold in the workplace and the more authority their voices hold, the more esteem and respect women tend to be given as a collective outside of the boardroom as well. When women’s contributions are recognized and valued from an economic perspective, a profound social shift and elevation of their status often transpires as a result.
In every corner of the world, when women are players in the economy, their families and their livelihoods are better off
In addition to positively impacting the overall economy and their places of work, the interactions of women in the formal economy also improve the home front as well. Women who are vibrantly engaged in the formal economy not only positively impact the financial situation of their families, but women with more education make better use of reproductive health and family planning information and services in achieving their desired family size and tend to have smaller, healthier families.
In Egypt, for example, children born to mothers with no formal education were more than twice as likely to die as those born to mothers who had completed secondary school.
It is widely known that there is a strong correlation between the level of education a woman receives, her ability to develop herself career wise and her contribution to the formal economy. However, it is also clear that her education and earning potential also influence her health and the wellbeing of her family as well.
Numerous studies have now shown that over the next decade, the global incomes of women will grow from US$13 trillion to US$18 trillion which is more than twice the GDP growth of China and India combined. McKinsey’s “Power of Parity Study” also confirmed that women’s economic contribution to global is around 37% GDP with African women contributing 39% to GDP which is slightly above the average.
These figures strongly suggest that in every corner of the world, when women are players in the economy, their families and their livelihoods are better off. This is encouraging, and we need more data points such as these, particularly for Africa.
While we intuitively know how important it is for women to be active contributors to the economy, there is very little empirical evidence quantifying contributions of women in the African economy and a dearth of reliable demographic data as well.
We have a severe knowledge gap when it comes to reliable data sets providing information geographically and sectorally.
- Which regions of the continent have the most enabling environment for female entrepreneurs and what key ingredients to this success can we share across our borders?
Armed with reliable data, we will be better informed to create strategies to increase the power and presence of women, and support them more appropriately
- What specific challenges are women facing in sectors where they are underrepresented and why?
- Which types of roles are women disproportionately not filling and why?
- Where are women making significant contributions and how can we better quantify this output?
- And where are they remaining marginalized and why?
Armed with reliable data, we will be better informed to answer questions such as these and create strategies to increase the power and presence of women, and support them more appropriately.
I would like to share a few findings from research study that my Trust completed a few months ago entitled “A Study to Explore Growth Barriers Faced by Female Entrepreneurs in East Africa”.
The aim of the study was to bridge a bit of the data gap I mentioned earlier and establish the growth barriers faced by East African female entrepreneurs that hinder them growing from micro and small enterprises to medium and large sized businesses and to inform interventions which will unleash their potential. Over 660 female entrepreneurs were surveyed across Tanzania, Kenya, Rwanda and Uganda, and many of the findings and recommendations are relevant to the South African context as well. The study found that:
- Female entrepreneurs in our neighbouring region are: * young and well educated, * with 69% falling between 20 and 40 years of age, * and 64% in possession of either a Bachelor’s or Master’s degree.
- They operate across a rich variety of sectors, most significantly in: * retail (17%) * agriculture (13%) and * consulting (11%).
- At least 50% of 600 businesses surveyed stated that they trade regionally and serve diversified markets.
I’d like to highlight a few of the findings as they mirror challenges female entrepreneurs in South Africa face and many solutions to these obstacles can be brought to bear with those seated in the room today:
A third of women entrepreneurs have not participated in any training for their business
- Over 50% of the female entrepreneurs cited access to finance (31%) and access to markets (23%) as the two main challenges they face and are still yet to overcome.
- The two biggest obstacles cited in accessing finance are collateral requirements and prohibitive interest rates. We found that out of the total of respondents that applied for a loan, only just over a quarter of them were successful.
Aside from constrained financial resources, we also found that:
- These women entrepreneurs are operating without significant non-financial supports to assist them and their enterprises;
- 67% of the female entrepreneurs who were surveyed do not have a board of directors and advisors; and
- 63% do not have a business industry mentor for guidance.
A third of women entrepreneurs have not participated in any training for their business.
I have a couple of suggestions for us to consider today and over the course of this Trialogue conference as we forge collaborations and partnerships to ensure women are given access to markets and finance, as well as your offices and boardrooms, and therefore, are fully able to lend their muscle to transforming this continent.
There is power in networks. Our approach to women’s empowerment at the Graça Machel Trust, is to establish and strengthen networks that drive the economic advancement of women and increase the participation and visibility of women in key sectors of society. Underpinned by the belief that development of the continent is hinged on the sustained participation of women in socio-economic spheres at all levels and across sectors, we have 3 networks operating across the continent which helps to amplify women’s participation in the economy:
New Faces New Voices is a network present in 16 countries which advocates for increasing women’s access to finance and financial services with the aim of advancing the inclusion of women in the formal financial system
The Network for African Business Women strengthens business women’s associations, and identifies and supports existing business women to develop into growth-oriented entrepreneurs in 10 countries in East and Southern Africa.
Through this network, and in conjunction with partners in the private sector, we support and grow the impact of women in the economic sphere.
Through the Women Creating Wealth enterprise development program, we trained 91 women entrepreneurs in Zambia, Tanzania, and Malawi last year on critical elements of entrepreneurship, including how to access markets and finance. By the end of our next training this year over 300 women will be equipped with the skills, resources and tools to help them grow their business.
We have The African Women in Agribusiness Network which addresses challenges in food security and identifies business opportunities for women in the agricultural sector in 8 countries. The African Food Basket project, is a regional project which touches 5 countries, that aims to expand opportunities and create wealth for women entrepreneurs and smallholder farmers in the seed and legume value chains to ultimately improve nutrition outcomes and household food security in Southern Africa. The project is being piloted in Malawi and Zambia and involves working with 22 women-owned seed companies and 2000 smallholder farmers.
Additionally, New Faces New Voices is a network present in 16 countries which advocates for increasing women’s access to finance and financial services with the aim of advancing the inclusion of women in the formal financial system. In Uganda, the chapter has provided financial literacy training to over 250,000 women and men in 2 rural districts, and established savings clubs to help community members to pool their resources. This subsequently led to a commercial (Finance Trust) opening a branch in this area which had never direct access to banking services before.
I’m also excited to let you know that our Rwandan chapter of this network has just launched a fund that will create a savings vehicle for Rwandan women to access capital markets for as little as $6. The Rugori Fund will invest in different market securities in Rwanda and East Africa and cash deposits. In 2 years’ time, the fund plans to invest up to 5% of its net assets in a second fund that will make debt and equity investments in women-led businesses or businesses that benefit women.
Women carry the unique weight in our society of juggling both family and career demands
Funds like these help women overcome barriers, I’ve previously mentioned, to accessing capital and markets they need to grow their businesses and contribute as fully as possible to the economy.
There is a need for support of networks like these to grow their memberships, develop their capacities and increase their scope and reach.
In addition to ensuring financial inclusion of women, there are practical ways in which companies can support their employees and women entrepreneurs. Company culture must reflect the value it places on its female staff complement and their unique contributions. Implementing pointed recruitment and retention efforts is one way to ensure key decision-making roles and board positions are filled by qualified female candidates.
Also, women carry the unique weight in our society of juggling both family and career demands. Therefore, taking advantage of technology, flex time and remote working conditions to accommodate these demands and help female employees balance family and work are also helpful ways to create an environment which enables them to be as productive and supported as possible.
Ensuring equal pay for equal work, and providing transparency in hiring and remuneration processes are additional key ways to ensure equity in the workplace and foster an environment of respect.
Mentor a promising colleague or entrepreneur, offer training programmes to upskill promising employees, and lend your expertise and networks as board members to female entrepreneurs.
I leave you today with a challenge to formulate ways in which you can play a greater role in your spheres of influences to ensure women’s voices are heard
The possibilities of support are endless.
It is in this context we are launching the “Women Advancing Africa” initiative as part of our ongoing efforts to ‘Multiply the Faces and Amplify the Voices’ of African women as a force for economic and social transformation.
“Women in Advancing Africa” is a continuation of catalysing our network building and establishes a platform for us to come together to transform this continent.
The inaugural “Women Advancing Africa” Forum will take place August 10-12 in Dar es Salaam and will convene more than 250 women leaders, rising stars and global champions to explore the critical role women play in shaping Africa’s future. Under the overarching theme of ‘Driving Social and Economic Transformation’, the Forum will focus on three core pillars:
- promoting financial inclusion,
- increasing market access and
- driving social change.
We believe that the selection of these three thematic areas provides a common agenda for women in the economy, as they are cut across all sectors of the economy and speak to all women at different levels of the economy. We invite you to partner with us in this effort and support initiatives like these which harness and unleash the power of African women.
Ladies and gentlemen, I leave you today with a challenge to formulate ways in which you can play a greater role in your spheres of influences to ensure women’s voices are heard, have a seat at the decision-making table, and are enabled to participate fully in the economy.
I encourage you to define for yourself and your organization how you are tangibly going to work externally with partners gathered here, and internally within your own institutions to create an enabling environment for women to flourish in business and in society, and in turn, help transform this beautiful continent of ours.