Investing in Women is Smart Economics

A recent global Gender Gap Report from the World Economic Forum shows that the gender gap has not recovered from the significant damage done during the Covid-19 pandemic. And, as we navigate another period of economic uncertainty, the systemic challenges facing women in the global labour market persist.

While data paint a difficult picture of working women and their ability to make it to the top, Covid-19 had a surprisingly positive effect on women entrepreneurship in some ways.

In recent years, there has been a significant surge in woman founders globally, with more women starting their own businesses than men. Across the world, the share of founders grew by 45% for women and by 32% for men in 2020, compared with 2019. This trend has continued as we have emerged from the pandemic.

Research shows that a staggering 40% of women entrepreneurs launched their businesses as a direct result of Covid-19. LinkedIn data mirror these findings, showing that woman members on the platform who had changed their title to “founder” during the pandemic had more than doubled compared with the pre-pandemic average.

While some undoubtedly started businesses to pursue their passions, many in this period probably became necessity entrepreneurs. In the face of economic hardship and inequitable workplaces, these women founders sought to take control of their careers and their futures. It is a fact that women were the most severely affected by Covid-19 in our country. Indeed, of the 3 million South Africans who lost their jobs because of Covid-19 and its related lockdowns, 2 million were women. We also saw gender-based violence increase during the lockdowns, and we continue to witness the scourge of abhorrent acts perpetrated against women and children.

Despite these issues and the widely entrenched and unacceptably high unemployment rate, the number of women-owned businesses in South Africa rose to 21.9% last year versus 21.1% in 2020. The fact that the entrepreneurial activity of women increased at a time when many other economies did not, and that necessity-driven entrepreneurship among women overtook that of men, reflects the resilience and survival mind-set of South African women.

The data show that supporting these women-owned businesses is both the right and smart thing to do. It is no secret that women drive the world economy, controlling up to 85% of consumer purchasing decisions. In our country, this is particularly significant, considering the high number of woman-headed households, which was estimated to be about 38% just two years ago. Given the economic power that women have, it makes commercial sense for more women to run these businesses.

As a global technology investor and operator, we at?Naspers?have seen first-hand the crucial role that women play in helping to build economies and businesses fit for a more inclusive future. I am seeing more and more South African female entrepreneurs who run thriving needs-based technology businesses. Take?Naked Insurance, for example, which we invested in through our early-stage tech investment vehicle?Naspers Foundry. Built from scratch and free from legacy processes, Naked - co-founded by?Sumarie Greybe?- is improving financial inclusion for ordinary South Africans by pioneering a business model that aims to restore trust in how insurance works. In the marketplace category there is Naspers Foundry-backed and women-owned home services platform?SweepSouth. The company has grown beyond our borders into Egypt, Nigeria and Kenya, while the platform has facilitated employment for more than 30,000 women - with decent pay.

Our youth social impact programme,?Naspers Labs, is designed to provide young people with in-demand digital skills for roles in software development, cybersecurity, cloud computing and data science, among other things. One of the programme’s aims is to encourage more women to pursue careers in science, technology, engineering and mathematics. Currently, 65% of Naspers Labs’ beneficiaries are women.

The words of Ngozi Okonjo-Iweala, the first woman and African to head the World Trade Organisation, ring true: “Investing in women is smart economics and investing in girls, catching them upstream, is even smarter economics.”

Of course, encouraging more women to start businesses and not providing them with adequate capital for growth is like sending talented mountaineers up Kilimanjaro without boots, oxygen or tents. Few will make it to base camp and for those who do, the chances of survival are low.

We are addressing this mammoth challenge of a more diverse tech ecosystem from many angles: supporting women founders through Naspers Foundry, training graduates with tech skills through Naspers Labs, funding young women to enrol in university through the Naspers bursary programme and employing and developing women in our own organisation. In pursuit of Naspers’s transformation goals, we are proud that, as of March this year, 64% of our workforce is made up of women and 71% of our top and senior management are women.

Women are indeed playing a more meaningful role in our economy, but we need an accelerated path to address the many challenges that hinder their progress. Creating the right socioeconomic and political conditions for women to thrive is of paramount importance for our country’s economic growth. Women are able to do a lot in a very difficult environment – imagine the contribution we could make if we had the right conditions.