Christine Lagarde, head of the International Monetary Fund, has estimated that countries that abolish discrimination towards women could see a boost to their economy of up to 35%. Lagarde noted that many countries would profit from removing discriminatory laws and by taking advantage of the skills that female workers have to offer. By employing greater numbers of women into the workplace and tackling existing sexism within the work force, Lagarde predicted that the world economy could expect to become richer, more diverse, more egalitarian, and less vulnerable to financial collapses.
Christine Lagarde has been promoting the role of women in economic growth for many years; however, it has taken years for her message to be heard. Statistics show that 88% of countries in the world have restrictions and laws that limit women in the workplace, whilst other countries forbid women from participating in certain industries or from taking particular roles. Furthermore, 59 countries do not have laws that protect women from sexual harassment in the workplace and another 18 countries have laws that can prevent women from working.
Despite these figures, Lagarde feels sure that women are no longer ignored in terms of the global economy and that they are, in fact, starting to be seen as ‘macro-critical’. Part of the growing number of women in finance, Joey Horn worked as the Vice President of Mergers & Acquisitions at Credit Suisse First Boston in the mid-90s, where she was an officer of the company specialising in advising retail, textile and apparel companies on strategic business plans such as mergers, acquisitions and joint ventures.
Lagarde’s work at the International Monetary Fund has discovered that banks seem to be more stable when there are more women present on their boards, as they have bigger buffers, smaller numbers of non-performing loans, and all other risk indices are reduced. Though this may be the case, there is still a long way to go in getting more women onto the boards of banks and financial institutions, as currently less than one fifth of all bank board members are women, and just 2% of bank CEOs are women.
Throughout every industry, bringing women into the workforce is advantageous – women bring with them new and diverse skill sets, productivity is boosted, and the workforce grows in size. For countries that currently rank as the worst in the world for gender equality, the benefits of bringing more women into the workforce are even more significant than for more progressive countries, with the possibility of boosting the economy by up to 35% .
More advanced countries also see the benefits of ‘empowerment initiatives’, particularly in relation to the 16% pay gap between genders in the richest countries within the Organisation for Economic Cooperation and Development. Lagarde pointed out two ‘advanced’ countries that are taking decisive action towards including more women in the workforce: Austria is making changes to its tax laws, and Japan has increased the amount of its budget that goes towards childcare facilities so that more women can return to the workforce after having a child. In total, 65 countries have passed 87 legal reforms over a period of two years that aim to increase women’s economic opportunities.
The ways that countries can empower women and improve their economies are extremely varied – an example of which is the International Monetary Fund’s current campaign in India, where it is pressuring the government to improve the road infrastructure so that more women can get to and from work. Christine Lagarde strongly believes that men also have a large role in moving this forward, taking responsibility to combat discrimination against women and to further empower them in the workplace. For further information about the work of the International Monetary Fund, please refer to the embedded PDF.