The Rising Trend of Corporate Women Networks

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In many parts of the world, women often face the barriers of discrimination and inequality. Whilst half of a country’s talent base is made up of women, they are often undervalued, under utilised, and under paid. Globally, women make up an average of 40% of the labour force in many countries however; they are mostly in informal sectors, especially within Sub-Saharan Africa (about 70%).

Historically, women entered the mainstream workforce during the outbreak of the Second World War in 1939 while men took off to serve the Army. In Africa and notably Nigeria, the entry of women into the corporate sector gained momentum only in the latter half of the 1980s (Omu & Makinwa (1987).

Across various sectors, the percentage of women in senior management positions are low compared to that of their male counterparts. According to the World Bank Enterprise Survey (2015), only one (1) of twenty six (26) salaried African women is employed in a senior management position as against one (1) in every six (6) men. Apart from managerial positions, women make up only a meagre of directors on corporate boards. A 2015 survey revealed that women currently fill only 14% of director slots on the boards of the top 307 Africa listed companies (AfDB, 2015, Where are the Women: Inclusive Boardrooms in Africa’s Top Listed Companies) and only about 5% of CEOs are women (McKinsey 2016). Still, women are often less paid than their male counterparts. Generally in Africa, only about a third of women actively participate in top economic activities.

Many studies have shown that the active participation of women in the economy, both in the public and private sectors, is fundamental to sustainable socio-economic development. Diversity, inclusion, and gender equality in the workplace are increasingly being recognised as critical success factors for businesses. The African Development Bank also records that there are over 30 studies showing a correlation between more women in senior corporate leadership roles and a company’s better financial performance.

For instance, in a 2007 study of Fortune 500 companies, The bottom line: Corporate Performance and Women’s Representation on Boards, it was found that, on average, firms with more women on their board of directors recorded better financial performance over the same period of time. Also, the firms with the highest female representation outperformed those with the lowest by an average of 54% (return on equity, return on sales and return on invested capital) (Ernst & Young, 2011).  Similarly, the MSCI World Index (2015) reveals that companies with strong female leadership generated a Return on Equity of 10.1% per year versus 7.4% for those without. Likewise, the Peterson Institute study (2016), which reviewed about 21,980 firms in 91 countries, concludes that having a woman in an executive position leads to better performance.

Gender diversity in the corporate sector, among other benefits, contributes to skills diversity and informs better decisions which in turn lead to better returns. Certainly, there is a business case for active women participation in leadership as well as other corporate activities. Several forward thinking organisations who have recognised these potential have re-examined their corporate strategy, amended the composition of their boards and executive management teams, and also integrated women development strategies into operations (both women workforce and client base). As part of women development, smart organisations are introducing flexible and remote work arrangements, benefits or incentives, mentorship opportunities, and internal women networks, among other initiatives, to retain and better groom  talent.

The Business Case

One of the hallmarks of a company that prioritises gender diversity is an active and thriving women’s network. Corporate Networking is a banding of like-minded individuals striving to develop through relationships with those perceived to have the potential to assist them in their work or career. There are different types of networks: from professional, occupational, to the broad-based internal corporate networks. As postulated by Catalyst (1999), internal corporate networks address the gender challenges women face within the organisational environment; the issues of isolation and exclusion of women in company social structures, and the growth difficulty occasioned by a lack of role models for women in established career paths.

In establishing a corporate women network that will impact on a business, there must be a clear mission and vision that align with the overall objectives of the organisation. Furthermore, network activities must empower women (in practical ways that resonate with their needs and ambitions) to achieve their potential; inspiring them by increasing access to role models and mentors; creating networking opportunities and enabling access to all employee ranks across the business. Such a network is also expected to promote internal and external programmes/initiatives, providing personal and organisational development that in turn profit the business in financial and non-financial terms.

Earlier established and very successful networks have been observed over time to be involved in Human Resources (HR) and Workplace Diversity activities in order to ensure women related issues are addressed and the interests of women are considered in recruitment and talent management processes within their organisations.

Moreover, women networks have collectively developed ideas or been involved in product and service development, which contributes to a company’s bottom line and improves brand image and corporate reputation. Research also reveals that some women networks are often leveraged upon during business bids because they have been effective in enhancing women’s understanding of a business, which leads to better productivity. It also leads to increased commitment and builds a better equipped workforce. In addition, empowerment and promotion of personal/career development within women networks address issues of career barriers and work-life balance, as well as increase the exposure of women to leadership positions.

In all, women networks have proven directly profitable and key for business sustainability in several corporate organisations. The Deloitte women’s initiative, launched in 1993, for example, has led to an increase in the retention of women at the same rate of men, within a couple of consecutive years. This has grossly impacted on the company’s turnover.

Recognising the huge benefits of a gender inclusive workforce and in aligning with international best practices, Nigerian organisations are beginning to embrace the importance of establishing internal women networks within their businesses. Apart from multinational organisations, there are a few women networks in Nigeria that have been impactful and continue to thrive. Most of the existing networks are within the financial sector and are mostly inspired by the Nigerian Sustainable Banking Principles (NSBP 4), which calls for the promotion of women’s economic empowerment through a gender inclusive workplace. Beyond formal regulations, the benefits of instituting a women network within an organisation surpass acceding to regulatory requirements or the resource commitment, as reflected in established networks across the world.

It is high time more Nigerian organisations explored the unique business case for women’s networks as demonstrated by the few existing groups, in order to enjoy the benefits of gender inclusion, and be positioned for sustainable economic development.

References:

AfDB (2015), Where are the Women: Inclusive Boardrooms in Africa’s Top Listed Companies: African Development Bank

CBN (2012), Nigerian Sustainable Banking Principles: Final Version

Ernst and Young (2011), Women of Africa: A Powerful Untapped Economic Force for the Continent: Ernst and Young

Singh V. et.al. (2006), Women in Formal Corporate Networks: An organization Citizenship Perspective.

The Historical Development of Women Career in Corporate Sector in Nigeria (PDF Download Available). Available from: https://www.researchgate.net/publication/275154536_The_Historical_Development_of_Women_Career_in_Corporate_Sector_in_Nigeria [accessed Aug 16, 2017].

http://www.pewresearch.org/fact-tank/2017/03/07/in-many-countries-at-least-four-in-ten-in-the-labor-force-are-women/

http://www.fin24.com/Special-Reports/Womens-Month-2016/only-5-of-ceos-in-africa-are-women-mckinsey-20160810

http://www.pewresearch.org/fact-tank/2017/03/07/in-many-countries-at-least-four-in-ten-in-the-labor-force-are-women/

http://www.businessinsider.com/companies-with-women-in-leadership-roles-perform-better-2016-6?IR=T

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