Gender Equality: Is a female CEO enough?

The nomination of Adena Friedman as CEO of Nasdaq, the first woman to lead a global stock exchange, created a positive stir in 2017. Yet, the same year, the United States was one of 60 countries around the world where the economic disparity between men and women actually worsened. At the current rate things are progressing, it will take another 217 years (seven generations) before we close the gender gap globally.* Why is it important to find a solution against this inequality impacting half of the population?

Gender Equality: An untapped source of revenues

Next to a moral priority, gender equality represents a significant source of potential revenues. Economic inequality of women affects the entire economy at local, national and global levels. USD 28 trillion (or 26%) could be added to global annual GDP by 2025 if full gender equality was achieved in the workforce.*

Gender balance also gives companies a competitive advantage and provides a financial opportunity. This economic opportunity is being increasingly coined the ?gender dividend?.

So, where do we start if we want to reach gender equality faster?

You can’t change what you can’t measure: Transparency is key

One of the biggest challenges we face is that most employers do not disclose how they treat men and women when it comes to pay, career development or leadership opportunities. Encouraging transparency among the largest companies will create a positive feedback loop that will expedite the progress of workplace gender parity.

In 2016, Jo Andrews and I launched Equileap and, together with a group of forward-thinking women and men, we have built the largest database on gender equality in the workplace. Our researchers are assessing over 3,000 companies in 23 countries, ranked on up to 19 criteria. Equileap looks at gender balance from the company’s board of directors to the workforce and supply chain, and at issues around flexible work options, parental leave, training and development. We also monitor gender equality controversies: class actions, individual cases and official rulings. Our methodology incentivises transparency; if companies don’t publish the data, we don’t take them into account. For the pay gap for example, a company that publishes its average gender pay gap - even if large - will get a higher score than a company that does not publish it at all. The highest score goes to those companies who have achieved a minimal to no pay gap at all.

Transparency is key because it allows consumers, employees and investors to know which companies are doing better on equality, and it enables us to make informed choices.

What YOU can do to take a leap towards Gender Equality

Publications, such as our 2018 Equileap Global Report, are now easily available and include the top companies per country as well as many gender equality insights. As a consumer, you can make a significant difference by considering what you do or do not buy. As an employee or an employer, you can see if your company makes it to the benchmark and discuss internally what is needed to show leadership amongst your country and sector peers.

As an investor, you also have an important role to play. Multiple gender-lens investment products have been launched around the world and their assets have surpassed USD 2 billion.* If you live in the United States, a new exciting tool is also available. Gender Equality Funds allows investors to see how mutual funds score on gender equality. This tool, created by As You Sow, screens the holdings of the most commonly-held mutual funds in the US, including financial giants such as BlackRock, Vanguard or State Street.

I hope that women like Adena Friedman, heading one of the most important stock financial markets in the world, together with many more women and men, will stand behind the ?gender dividend? and aim to achieve equality from the boardroom to the workforce and supply chain. We can no longer gloss over the wrongdoing of discrimination. Trying to “fix it” with a couple of women in leadership positions is a form of pinkwashing and not enough. Let’s make sure that a woman at the table doesn’t make the headlines anymore and becomes the norm.

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* World Economic Forum, The Global Gender Pay Gap Report 2017, November 2017

* McKinsey Global Institute, The Power of Parity, April 2016

* Veris Wealth Management, Gender Lens Investing: Bending the Arc of Finance for Women & Girls, November 2018