By Sandie Okoro, Senior Vice President and World Bank Group General Counsel
This blog is part of a special series exploring subjects at the core of the Human-Centred Business Model (HCBM). The HCBM seeks to develop an innovative – human-centred – business model based on a common, holistic and integrated set of economic, social, environmental and ethical rights-based principles. Read more about the HCBM here, and check out an event about it here.
The HCBM project originated in 2015 within the World Bank’s Global Forum on Law, Justice and Development and is now based at the OECD’s Development Centre.
This blog is also part of a special series marking the launch of the updated
2019 Social Institutions and Gender Index (SIGI).
We have witnessed numerous efforts to enhance gender equality throughout the past decade. Legal reforms are taking place worldwide, and discriminatory laws are slowly being struck down in favour of parity. But despite developments in employment laws, inequality persists. Women’s labour participation has been stagnant, and last year, the already low number of female CEOs tumbled even further. As the provider of 90% of jobs worldwide, the private sector plays a significant role in the push for gender equality in employment. By adopting gender-smart policies, companies may be able to fill the gaps unaddressed by laws and minimise the impacts of inequality in the workplace. Although not all women work in these institutions, such policies are nonetheless impactful for those who do and could set in motion a new and replicable culture of work – one that is both business-smart and more gender-inclusive.
Gender inequality and discrimination hold back women’s careers. In nearly half of the world, discriminatory laws bar women from entering certain professions. In most countries, women’s lifetime earnings will be 60–75% of what men will make. The gap in lifetime earnings reflects the combination of women’s lower levels of labour participation and lower wages received when they do work. The wage gap is driven by employment segregation; women are concentrated in lower paying sectors and occupations. For both participation and wages, social norms and gender roles (including around childcare, appropriate careers, mobility) are additional hurdles women face.
Women are not the only ones who feel the impacts of gender inequality. Employers too suffer from its consequences. Women are essential in providing new and vital insights into consumer preferences, which could lead to boosted profits for the company. Studies have linked women in leadership positions to increased profitability, improved reputation, and higher employee and customer satisfaction. Indeed, the Human-Centred Business Model recognises that implementing principles that embrace equal employment opportunities for men and women, equal pay for equal work, and equal treatment, including for vulnerable workers, not only underpin a company’s values but also advance its competitive advantages. Furthermore, as women make up roughly half of the population, when companies are unable to manage gender diversity, they lose the opportunity to hire and retain top talent. Therefore, it is only reasonable that they try to create work environments that will be attractive to women.
One of the ways to achieve this is by adopting gender-smart work policies. Such policies address the challenges women commonly face in the workplace. Examples include policies on family-friendly work and sexual harassment. Such policies benefit not only both female and male employees but also the business overall.
Take, for example, family-friendly policies. These usually include childcare solutions, flexible working arrangements and parental leave. Remote working, made possible by technology, and childcare options help employees maintain better focus at work, increase productivity and avoid burnout. The availability of accessible and reliable parental leave and childcare options encourage parents to feel more prepared to return to work and eases the transition back to their careers. For companies, this means they will be able to retain the people in whom they have already invested and trained. It also sends an important message: Workers are valued and, in the case of remote working, trusted to work with low supervision.
Although not exclusively beneficial to women, family-friendly policies are key to increasing female labour participation. We cannot ignore the fact that in most households, caregiving and housework duties remain in the hands of women. Globally, women undertake 75% of unpaid and domestic work. For working women, this means that they are expected to fulfill household duties in addition to their careers. If workplace policies do not leave room for flexibility, it would be difficult to juggle these two responsibilities. As a result, partners may be put in a position to decide who will be sacrificing their careers. In households where men are seen as breadwinners and women as caregivers, it is not difficult to guess who will likely be making that sacrifice.
Admittedly, these policies are not foolproof. Flexible work hours can blur the lines between office and personal time, creating an atmosphere of constant work that can lead to stress. Stereotypes and stigmas attached to family-friendly programmes also hinder their effectiveness. For instance, flexible work arrangements and parental leave are misconceived as “career-killers” for men. Men often experience discrimination after taking parental leave and are twice as likely as women to have their request to work flexibly rejected. Thus, despite the existence of such programmes, very few men decide to fully take advantage of them.
This does not mean that family-friendly policies are impractical. It merely tells us they must be followed with proper investment, time and consistent monitoring to become more effective. Sufficient resources must be allocated to developing, observing and re-assessing strategies to see what policies are needed and suitable for the workplace. Management teams themselves could help normalise these programmes by using flex-work arrangements or parental leave, which, in time, would encourage other employees to do the same.
Another gender-smart solution is the adoption of robust anti-harassment mechanisms. One in five countries do not have appropriate laws against sexual harassment in employment. Thus, this could be an area where the private sector can make the first move because, after all, it is within their best interest to do so. Survivors of harassment report suffering from heightened stress, demotivation, decreased morale and productivity. When they have no access to recourse, they often have no choice but to quit their jobs. Sexual harassment would cost a typical Fortune 500 company approximately USD 6.7 million a year in absenteeism, low productivity and employee turnover.
And sexual harassment disproportionately impacts women. In most regions, at least 30% of women have reported being harassed in the workplace. If companies want to retain female talent, they must ensure that women feel secure in the office. Effective anti-harassment policies should not only provide recourses for survivors but also develop a culture of awareness and support that encourages staff to report red flags and violations.
If employers can establish a system that works, they will cultivate new waves of talent who recognise the benefits of gender-smart solutions today and into the future. They can continue the virtuous cycle when it is their time to hold leadership positions. For their part, governments can further strengthen these efforts by adopting initiatives for pay transparency and sanctions for non-compliance. Ultimately, putting these combined efforts into play can very well generate gender-smart solutions as powerful instruments for equality.
 World Bank Group, “Women, Business and the Law 2019 Report: A Decade of Reform,” (2019). Available at http://pubdocs.worldbank.org/en/702301554216687135/WBL-DECADE-OF-REFORM-2019-WEB-04-01.pdf
 International Finance Corporation (IFC), “SheWorks: Putting Gender-Smart Commitments into Practice,” (2016). Available at https://www.ifc.org/wps/wcm/connect/de9a7ee8-940a-450a-bb19-eb452f9fa08e/SheWorks+Final+Report.pdf?MOD=AJPERES&CVID=lDhiP4z
 IFC (2016), p. 5.
 World Bank Group, “Women, Business and the Law 2018 Report. Available at http://documents.worldbank.org/curated/en/926401524803880673/pdf/125804-PUB-REPLACEMENT-PUBLIC.pdf; OECD (2019), “SIGI 2019 Global Report: Transforming Challenges into Opportunities,”Social Institutions and Gender Index. Available at https://read.oecd-ilibrary.org/development/sigi-2019-global-report_bc56d212-en
 IFC (2016), p. 27.
 IFC, “Investing in Women’s Employment: Good for Business, Good for Development.” Available at https://ppp.worldbank.org/public-private-partnership/sites/ppp.worldbank.org/files/documents/Global_InvestinginWomensEmployment.pdf
 IFC (2016); Dr. Yılmaz Argüden, “Diversity at the Head Table: Bringing Complementary Skills and Experiences to the Board”, International Finance Corporation Private Sector Opinion Issue 19, (2010), p. 11. Available at https://www.ifc.org/wps/wcm/connect/topics_ext_content/ifc_external_corporate_site/ifc+cg/resources/private+sector+opinion/pso_19; IFC Private Sector Opinion, Alexandre Di Miceli and Angela Donaggio, “Women in Business Leadership Boost ESG Performance: Existing Body of Evidence Makes Compelling Case.” Available at https://www.ifc.org/wps/wcm/connect/21ab518b-dfc8-4ec2-82b7-c5653a366ce9/PSO42.pdf?MOD=AJPERES&CVID=muo7s9y.
 Id., p. 10.
 OECD (2019).
 IFC (2016), p. 44.
 Paula Tavares and Quentin Wodon, “Global and Regional trends in Women’s Legal Protection against Domestic Violence and Sexual Harassment,” p. 8. Available at http://pubdocs.worldbank.org/en/140781519943384134/EndingViolenceAgainstWomenandGirlsGBVLawsFeb2018.pdf.
 Paula Tavares and Quentin Wodon, “Sexual harassment – Where do we stand on legal protection for women?” (2018). Available at https://blogs.worldbank.org/voices/sexual-harassment-where-do-we-stand-legal-protection-women.
 IFC (2016), p.54.
 IFC (2016), p. 51.
 Id., p. 53.