In March 2023, the world’s attention focused on International Women’s Day (IWD) and its accompanying theme, #EmbraceEquity. The slogan focused on fairness rather than equality, achieving equal results, rather than equality of opportunity.
In this article, I will focus on the representation of women in management and decision-making positions in African businesses. This topic is important because it has a significant impact on empowering women beyond boardrooms and in male-dominated fields like healthcare, technology and sports. To provide context, let’s first look at the big picture.
Global representation of women in the business sector
According to a June 2022 London School of Economics article, institutions including the IFC, IMF, World Bank, ILO, McKinsey and the European Commission support the business case for women in leadership roles. direction. They found that gender diversity on boards resulted in greater shareholder value, better corporate governance, better financial performance, better return on equity and assets, greater satisfaction customers and employees, investor confidence and a better reputation in the market.
In 2021, only 8.1% of Fortune 500 CEOs were women, even though the percentage of women in CEO positions has slowly increased since 2000. But women remain a minority, with only 41 female CEOs, including just two black.
When it comes specifically to African businesses and professionals, progress is limited. A 2016 McKinsey report, “Women Matter Africa,” indicates that African companies are no different from their global counterparts in terms of business performance. Companies with at least a quarter of women on their boards had an average EBIT margin 20% higher than the industry average. Yet, according to The Boardroom’s 2021 diversity report, women hold only 14.2% of board seats and 15.7% of non-executive director seats at listed companies.
Certainly, more and more women now occupy managerial, executive director and general director positions within Corporate Africa. West Africa’s United Bank for Africa recently appointed its first female CEO for Africa, making its board a majority female board.
Factors determining female representation in African companies
I believe there are a few factors that can help accelerate the pace of female representation in African businesses. For example, the traditional African “Omugwo” (a family system of post-pregnancy support provided by grandmothers) can enable more African women to return to their careers with the assurance that their children are cared for by their family . Rising inflation and the high costs of raising children sometimes force families to have two working parents. So in Nigeria, where I come from, contraception is increasingly accepted as a way to plan childbirth. Additionally, African women who become more educated can apply for more leadership positions. Finally. Gen Z and millennials seem to reject traditional stereotypes about women’s roles, such as cooking. Some working women order ready-made soups and staples, which are delivered to their homes, reducing meal preparation times.
Investment as a driver of equity
ESG requirements from investors and donors have also played an important role in promoting fair practices in African businesses. According to a January 2023 report from Rover Publication, Botswana, Uganda and Ghana rank first, second and third respectively among countries with the highest number of women entrepreneurs in the world for the third year in a row, and ESG stipulations donors and aid agencies. may have contributed to this trend.
The same report shows that 58% of African SMEs, which contribute around $300 billion to the continent’s GDP, are led by women. Unfortunately, only 1% of these women-led SMEs receive funding from venture capital firms. So, even though the region benefits significantly from high rates of female entrepreneurship, access to capital remains a challenge.
The presence of such levels of female entrepreneurship could be a lever for gender equity, if only access to capital were not such a challenge. According to Aviva Whitten Cox, “much of the funding for women-led startups in Africa (especially Kenya) goes to non-local founders.”
The role of governments
Governments can take the lead in mainstreaming gender equity by implementing board quotas, coupled with diversity disclosure requirements. Germany, India, Brazil, Iceland, Spain and Israel have implemented this strategy. Some argue, however, that this is not always fair to companies, as they must hire based on knowledge, skills and experience and, in some cases, this can be disproportionate to target quotas.
An alternative approach could be that of voluntary objectives implemented by companies, driven by civil society, motivated by investors and pushed by government policies.
Ultimately, it will always be up to women (and men willing to embrace equity) to ensure they get their justified seat at the boardroom table. According to the previously mentioned McKinsey & Co. study, common traits among high-performing African women executives include a strong work ethic, perseverance in achieving goals, willingness to take risks, resilience in the face of adversity (including the courage to disagree). ), a commitment to professional development and the proactive cultivation of mentors, sponsors and peer networks (all genders).
These are undoubtedly the hallmarks of leadership and call for women to take on more roles at the helm of African corporate affairs.
Subomi Plumptre is the CEO of Volition Cap, an African SEC-registered asset management firm working to bring financial prosperity to middle-class Africans and diasporas.