Environmental sustainability has become an integral element of the business plans of many corporations. At the urging of consumers, employees, and shareholders, companies have come to understand the business risks of ignoring their impact on the environment, as well as the benefits of being a responsible environmental steward. Yet few companies have made a similar shift when it comes to women’s empowerment and increased gender equality.
In “Empowering Women at the Grassroots,” an article in the current issue of SSIR, Dina Dublon and I explore the steps that some corporations are taking to promote opportunities for women in developing world markets. But it’s time for companies to take the next step—a step that will involve incorporating gender equity into the mainstream of corporate life. On the eve of International Women’s Day, leaders would do well to consider the ways that empowering women can promote long-term organizational growth.
There is a growing body of data on the benefits of empowering women in all parts of an organization—from factory floor to boardroom. According to studies issued by Catalyst, Credit Suisse, and McKinsey & Co., increases in the number of women in senior management positions and on corporate boards correlate with improved financial performance. The McKinsey report, for example, found that “companies in the top quartile for gender diversity are 15 percent more likely to have financial returns above their respective national industry medians.” Our article cites a wealth of other findings that point to the positive impact that greater gender equality has talent development, productivity, and access to sustainable markets.
Despite such data, companies rarely treat women’s empowerment as a vital part of their corporate sustainability initiatives. Even when companies do recognize the significance of gender equality, they typically do so in the form of discrete programs or initiatives. In a single company, the human resources department may take responsibility for employee diversity issues, the corporate social responsibility team may promote gender equity as a human rights issue, the board of directors may focus on C-suite and board diversity, and the supply-chain managers may work to ensure gender diversity among suppliers. Rarely do those groups work together in an integrated way on gender initiatives.
Nonetheless, a few corporations have begun to consider gender equity issues in a more integrated way. The Coca-Cola Company, for example, has four women on its 15-person board. (The Catalyst study found that having more than three female board members can have a significant impact a corporation’s return on earnings and its return on investment.) Coca-Cola also boasts “women” as one of the three legs of its Sustainability Plan—the other two are “water” and “well-being”—and in 2010 the company introduced 5by20, an initiative to support the economic empowerment of women who are part of its global value chain.
More broadly, a wide range of people and institutions have begun to show an interest in companies that have an integrated approach to advancing women throughout their organization. A growing number of investors, for instance, are applying a gender lens to their investment decisions—as Sarah Kaplan and Jackie VanderBrug’s discuss in their SSIR article, “The Rise of Gender Capitalism.”
In addition, systems to certify companies and products on the basis of gender equity criteria are starting to emerge. (This development follows the pattern in which eco-friendly certification schemes— the RA-Cert process of the Rainforest Alliance, for example—helped promote the cause of environmental sustainability.) The EDGE scheme, launched at the World Economic Forum in Davos in 2011, certifies companies on the basis of internal policies and practices that promote gender equality. In 2014, L’Oreal became the first US company to receive EDGE certification.
This year, the United Nations is preparing to adopt 17 Sustainable Development Goals to replace the Millennium Development Goals, and the new set of goals (like the preceding set) calls for the advancement of gender equality and women’s empowerment. Corporate leaders are taking steps in that direction as well. Last June, UN Women established the Private Sector Advisory Council, a 10-member, invitation-only group that includes Coca-Cola, L’Oreal, and Unilever. And at the Clinton Global Initiative meeting held in September, the World Bank announced the launch of She Works, a partnership in which 10 companies are working to enhance women’s employment opportunities globally.
It took many years—and a great deal of pressure from customers, employees, and investors—for corporations to recognize the long-term relevance to their business of greenhouse gas emissions and other environmental threats. And even then, true integration of environmental sustainability into corporate planning happened only when corporate leaders (such as Paul Polman, CEO of Unilever) used data about those threats to build a business case for a new framework. As more CEOs reflect on how gender equality can benefit their business, we will see more corporations develop programs that empower women across their value chain. By applying a gender lends to all of their operations, companies will not only help to transform the lives of women and girls around the world, but also promote sustainable development for all.