The Power of Gender Parity

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Saudi journalists participate at a conference in Riyadh, January 23, following their meeting with the Gulf Cooperation Council. REUTERS/Jacquelyn Martin

Global and regional economic advancement starts with equality between the sexes

BY Rima Assi

Women’s workforce participation is vital for socioeconomic growth, yet gender inequality remains a critical issue worldwide.

If women were to participate in the economy on par with men, their contribution would add $28 trillion, or 26 percent, to the global economy in 2025.

This is roughly the combined size of the economies of the U.S. and China today.

Even if countries were not to achieve full gender parity but were to match the progress of their regional neighbors closest to closing the gender gap, this scenario would see $12 trillion added to the global gross domestic product (GDP) in a decade—equivalent to the current economies of Japan, Germany, and the U.K. combined.

Accelerating the bridging of the gender gap requires action, not only in workplaces, but in society as a whole by addressing attitudes limiting the role of women. Using collective measures of economic equality, including wages and labor force participation rates, education, and financial and digital inclusion, as well as metrics for social, political, and legal equality, a study identifies 15 gender equality indicators for calculating countries’ ‘gender parity scores’ and, unsurprisingly, a strong correlation between high scores on social indicators and high scores on economic indicators.

Despite progress in parts of the world, gender inequality remains significant and multi-dimensional. High levels of gender inequality in most aspects of work—especially in labor force participation rates, wages, leadership positions, and unpaid care work—as well as in legal protections, political representation, and violence against women are common in tens of countries worldwide.

Today in the Middle East and North Africa (MENA) region, women contribute only 18 percent of the GDP and represent just 24 percent of the workforce. Recent years have seen MENA governments and public and private sector organizations realize significant legal and regulatory milestones for improving women’s voting rights, education, and representation in leadership positions. One example is the announcement of the United Arab Emirates’ new cabinet, in which women now occupy one third of posts.

In the Gulf Cooperation Council (GCC) region alone, bringing each country to the best regional standard for women’s workforce participation would add $180 billion, or 7 percent, to the economy in 2025. Full parity would bring that figure to $830 billion–32 percent.

Significant challenges remain, but the region has begun undertaking large-scale discussions of strategies to accelerate gender parity.

Held for the first time in the MENA region, last month’s Global Women’s Forum in Dubai brought together global leaders from the public and private sectors to commit to innovative approaches for promoting women’s workforce participation and career advancement.

At the forum, reports on ‘Power of Parity’ and ‘GCC Women in Leadership’ fueled discussion during the CEO Champions Initiative. A survey in the latter report found that over 60 percent of GCC companies rank women’s involvement in leadership positions as a ‘very important’ driver of organizational effectiveness, an especially promising factor given research showing that companies with three or more women in top management positions score significantly higher in every single measure of organizational effectiveness compared to others.

Companies can complement the efforts of government and nongovernmental organizations in tackling gender inequality through several approaches.

First, businesses can use financial mechanisms to support women entering the workforce. For example, companies could offer scholarships to girls for improving their science, technology, engineering, and math (STEM) skills, as well as monetary assistance to keep girls in school longer, and subsidized childcare for working mothers.

Second, companies are well positioned to use technology to solve gender-related problems. Telecom firm Vodafone has developed mobile apps to help women boost their reading skills and connect them to emergency services if subjected to violence.

Third, organizations can adopt internal practices supporting gender diversity, such as promoting entrepreneurship and implementing flexible employment, leadership training, and skill building programs for women.

Fourth, companies can support education and training for girls and women, with offerings ranging from STEM programs and vocational training to those targeting health, financial, and digital literacy.

Fifth, companies can use the power of their brands and marketing expertise to shift entrenched attitudes, which limit women and address unconscious biases. Example interventions include engaging individuals and communities in dialogues; the promotion of role models, support, and peer groups for women; and national awareness efforts using mass and social media campaigns.

Finally, companies can support policymakers’ efforts to implement gender-neutral laws, policies, and regulations, including ensuring their own compliance with such laws (such as equal pay), as well as openly advocating for change.

Women matter in companies and in society—they are board directors, employees, customers, suppliers, educators, mothers, and pillars of their communities. They constitute half the world’s working-age population but generate only 37 percent of GDP and undertake 75 percent of unpaid work.

Enabling women to be equal partners in society and the workforce will not only be equitable in the broadest sense but unambiguously good for business.

Companies can play a crucial role, and more business leaders should join their peers who are already engaged in this issue to form a new coalition for change that tackles this most pressing of human and economic issues.

Rima Assi is Partner at McKinsey & Company’s Middle East Office

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