In May 2020, UN Women convened a high-level roundtable on the subject of “the G7’s role in ensuring women’s economic empowerment and security in the post-COVID future.” Addressing these issues, Executive Director, Sima Sami Bahous, said: “Women earn less, save less, hold less secure jobs, and are more likely to be employed in the informal economy with less access to social protections.” She called on world leaders to “permanently redress these long-standing inequalities in order to create inclusive, equal, and more resilient societies.” There followed 10 key actions for member states to promote gender equality and women’s economic empowerment.
Women’s economic empowerment
Recognising the historical disparities in opportunities for women to advance in the economy, affirmative action to redress these issues is evident. For example, Entrepreneurship Development in Higher Education (EDHE), a division of Universities South Africa, launched the Student Women Economic Empowerment Program (SWEEP) in 2021. The program employs a three-tier model of (i) professional and employability skills and opportunities, (ii) entrepreneurship and economic activation skills and opportunities, and (iii) sustainability and survival skills and opportunities.
But unique challenges exist: a continuing gender bias, lack of networking and role models, and lack of training and education in business skills, conflict with balancing responsibilities (home and work), defying social expectations, and access to funding of start-up capital. Women in business still have to battle to be taken seriously, which can also make building a support network more difficult.
Women also suffer from unfavorable business environments. They must deal with clients and suppliers who don’t take them seriously, and who may harass them. They frequently operate in unsafe work environments, and suffer from a lack of respect from peers and community members. However, there is a slow shift towards more female-led start-ups and high-growth female-operated businesses. Women are also pursuing entrepreneurial aspirations, particularly in the Middle East and Africa. Overall, numbers of female entrepreneurs are growing globally.
Is economic empowerment enough?
There is no mention of financial education as an enabler within the 10 key actions, although step nine does urge members to “ensure that gender equality is front and center of learning and skills development … to ensure that no girls are left behind.” So what ‘learning and skills’ are needed, and what are we to understand by the economic empowerment of women? One definition states that a woman is economically empowered when she has both “the ability to succeed and advance economically and the power to make and act on economic decisions.” But for this to happen, women need the skills and resources to compete in markets, as well as fair and equal access to economic institutions.
Skills and resources
These can be at the individual and community level. Conventional wisdom tells us that the skills and resources needed for successful entrepreneurship are more than financial or monetary in nature. They include:
● Financial capital, such as savings and loans
● Physical capital, such as land and labor
● Social capital, such as mentors and networks
● Human capital, such as education, skills and training
Which brings us to the core of our question: why is financial education so important for gender equality? The simple answer is that without it, women lack a key resource for economic empowerment.
A history of disempowerment
The norms and values embedded in the economic ecosystem are deeply entrenched. Norms and values are the ‘rules’ that govern activities and institutions, mediating relations between individuals and their social and economic environment. They also influence how resources are distributed and used. Norms determine, for example, whether it is appropriate for women to be in certain places, hold certain positions, and to be responsible for money. Some of these restrictions may be enshrined in a country’s law and policy.
A recent World Bank study notes that there are still 104 economies that restrict the type of work that women may perform. As a consequence, 2.7 billion women do not have the same choice of jobs as men.
How much disempowerment is due to a lack of financial literacy?
Control of resources is about holding and retaining power. This is put forward as one reason why men are reluctant to cede financial independence to women, in line with the other well-entrenched norm: whoever has the gold, makes the rules. The male-as-breadwinner stereotype subjugates women to a continuing dependent role. The same holds true of the power of networking and mentorship, where the ‘old boys’ club’ mentality still holds sway. In a world where women have access to a bank account, financial literacy is the pathway to economic independence. In many countries, this process begins with a need for a change in the laws that prohibit access to credit based on gender or marital status, coupled to the abolition of gender-based pay discrimination.
Financial education enables women to expand their knowledge, manage their savings, household expenditures and gives them access to credit. This in turn empowers them to be less risk averse and more confident in engaging in negotiations regarding their financial decisions. EU Business School offers a range of finance-related options, including the BA (Hons) in Business Management (Finance) and the Master in Finance.
For details of programs and applications, visit www.euruni.edu