The Importance of Women's Leadership in Economies Around the World

Strong leadership requires confidence, determination, and integrity. While traits like these are not exclusive to any gender, women only hold 24% of senior leadership positions around the globe. This systemic imbalance often leaves women without the opportunities they need to further their careers and develop into leaders in businesses anywhere in the world.

Gender inequality in the workplace has been an unfortunate long-term reality. Less than half of women — 47.7% — participated in the global labor force in 2019, down from 50.9% in 1990. Holding less than 5% of Fortune 500 CEO roles remains a stubborn and challenging statistic, especially considering there were zero Fortune 500 female CEOs as recently as 1995. 

Despite this gap, women often make the most effective business leaders. Research suggests that companies with the highest percentage of female board directors outperform those with smaller percentages, and women tend to rank higher in core leadership competencies such as collaboration and self development. In addition, female entrepreneurs generate twice the revenue of their male counterparts with the same amount of investment.

Elevating women to leadership positions isn’t just the right thing to do; it’s good business. Thankfully, regions around the world are currently making great strides to help women grow into and succeed in leadership to combat gender inequality. Here are some examples of initiatives from Asia Pacific, Europe, Latin America, Middle East/Africa and North America.

Asia Pacific

According to McKinsey & Company, women in Asia contribute to 36% of Asia’s GDP, but labor force contributions have been historically divided between single and married workers. While gender inequality remains high throughout the region, economic development, government policies, and technological change are each driving a greater migration toward an equal workplace with female-powered leadership. For example, the International Finance Corporation, a sister organization of the World Bank, has trained more than 300 women for future board directors positions in Sri Lanka and helped develop India's corporate governance scorecard, which features gender diversity as a prime factor.

Europe

Throughout the European Union, one out of three managers are female, and 28% of senior roles are held by women. To advance gender equality, the European Commission has launched several initiatives to reduce the gender pay gap, such as adopting a Pay Transparency Recommendation and ensuring that at least 40% of the Commission’s middle and senior managers are women by the end of 2019, and improve the work-life balance for parents, such as adopting a comprehensive package of policy and legal measures to modernize EU legislation on family-related leave and flexible working arrangements. Some companies, such as Accenture UK, have prioritized their commitment to company-wide diversity and have tailored programs to develop women executives. In this case, the organization's Chief Leadership Officer regularly meets with senior leaders to discuss women's initiatives and develop plans for change.

Latin America

According to a survey by McKinsey & Company, gender diversity has become a top priority in Latin America, with 37% of respondents identifying the issue as a major strategic agenda item. In addition to traditional issues women face in the workplace, political instability has affected the implementation of laws that promote and encourage women’s empowerment. Nevertheless, Latin America is emerging as a hub for female STEM entrepreneurs, with women leading 35% of Latin America’s financial tech startups.

Middle East/Africa 

Women represent around 49% of the MENA region’s total population but, on average, represent just 4.8% of total voting board seats in MENA’s 142 largest public companies.

But women are making strides in breaking into leadership roles. In Lebanon, Raya Al-Hassan became the first female interior minister in the entire Arab world. Princess Reema bint Bandar Al-Saud became the first female ambassador to represent Saudi Arabia. In Bahrain, women comprise one-third of the foreign ministry personnel. The MENA-OECD Working Group on Corporate Governance is an example of an initiative that supports policy makers in MENA to improve gender balance in corporate leadership.

North America

According to the Center for American Progress, women have faced challenges in ascending to leadership positions across different industries. For instance, 22.7% of women in the legal profession are partners, and 16% of medical school instructors are permanent medical school deans. Despite this, organizations are continuing to make concerted efforts to encourage female leadership. For example, in 2005, after Allstate launched a sponsorship/training program designed to pair women with leaders within the company, 20% of participants earned promotions and 50% of participants at the director level were promoted to vice president. Regions across the United States are also following suit to enforce laws to promote gender equality. For example, California passed a law in 2018 mandating that every public company in the state have a woman on the board by the end of 2019 or pay a one-time fine of $100,000 USD.

Around the world, organizations have started recognizing and addressing gender disparity. Over the past decade, gender quotas, new policies, and pressure from investors have significantly boosted female board participation in organizations across various industries. Looking to the future, expanding on current policies such as paid maternity and paternity leave, requiring gender-balanced government cabinets, and implementing childcare subsidies can help bridge the gender gap further and reduce typical work-life balance issues faced by women.