If sanity finally prevails in the US, we should have Hillary Clinton in the White House come January 2017, to preside over the affairs of that troubled nation. That she will be the first woman president of the US should raise eyebrows but the relief if Donald Trump doesn’t get a chance to impose his machismo on the rest of the world, would overshadow that. If Clinton does make it, she will join powerful women like Angela Merkel and Theresa May, as leaders of powerful democracies.
Woman power, it would seem is finally being recognized. Sadly, the same can’t be said of the world’s largest multinational companies with only two of the top 20 companies in the Fortune 500 list being headed by women. At home, of course, the numbers are even more abysmal. Not one of the large family businesses in India is headed by a woman while all the dynamism of the IT sector hasn’t extended to trying a woman CEO. The malaise isn’t just restricted to the top but extends to the overall numbers in the workforce.
Just last week, Tata Motors announced plans to up the share of women workers at its plants to 15%. That may be some time in the future for the sad reality is the current figure is an abysmal 3%. And the Tata group company is one of the more socially aware firms we have in India.
Just why is the percentage of women in the country’s formal workforce so low? According to a report by Ideas for India, female labour force participation in India is among the lowest among emerging markets and declining. In fact, in contrast to other emerging markets, female labour force participation in India has dropped over the past decade. And while much of the decline, especially since 2005, reflects a decline in unpaid female self-employment (which is counted as part of the labour force) in agriculture, it hasn’t been matched by a movement into other work areas.
There are tangible gains for the economy with increased female participation in the workforce. Organisation for Economic Co-operation and Development calculations show that growth could be boosted by up to 2 percentage points with a package of pro-growth and pro-women policies.
But Indian companies have done precious little to make their workplaces women-friendly. Despite the work by evolutionary biologists and population demographers proving that women need to bear babies and care for them for a certain time in their life cycle, Indian companies continue to pretend women exist only as workers even when they do hire them. We have fewer women at the top because women drop out in large numbers post partum. Breastfeeding rooms and next door day care, and time off for looking in on sick babies, are now an essential part of global corporate builds. Finding such basics in Indian workplaces is more difficult than finding a one inch needle in a one acre haystack.
Nor is this restricted to just the rank and file. At the top, the crisis is even deeper. India’s business families follow a curious logic. Wherever the family patriarch doesn’t have a son, he is quite happy to hand over the reins to the daughter. Shiv Nadar’s daughter Roshni Nadar who heads HCL Corp. as well as Raj Saraf’s daughter Devita Saraf, spring to mind as daughters who are the chosen successors. The moment there is a son or sons, it is a different story altogether. No matter how singularly lacking the chosen son is in terms of ability and competence he always has the first rights to destroying the family fortunes.
Even worse is the emergence of Indian women as budding entrepreneurs. Through the sea of red ink in which most of the e-commerce start-ups are drowning, there’s hardly a female face to be seen. What’s most disappointing is that India lags the world in this. Today, 46% of the privately held companies in the US are now at least half-owned by women.
What is it that women can bring into a corporate environment? Arianna Huffington’s perceptive remark that the tragedy of Lehman Brothers may never have happened had it been Lehman Sisters, points to a touch of sanity that women can bring to testosterone-filled board rooms. Some years ago Harvard Business Review quoted research by Hay Group, culled from its 17,000-person behavioural competency database, which found that when it came to empathy, influence, and the ability to manage conflicts at the executive level, women show more skill than men. Specifically, women are more likely to show empathy as strength, demonstrate strong ability in conflict management, show skills in influence, and have a sense of self-awareness.
But it isn’t just the softer, touchy-feely stuff that distinguishes women in corporate positions. Hard numbers, too, support their contribution. Studies show that firms with more women in leadership positions tend to be more profitable. Policy think-tank, Peterson Institute for International Economics, surveyed 21,980 publicly held firms from 91 countries to determine how the gender makeup of companies’ upper ranks is related to their financial performance. Its researchers found that companies with at least 30% of women in their most senior “C-suite” management positions are about 15% more profitable than firms with no top women executives. The researchers said that when women get a better education and have a better chance to get work experience free of discrimination, it fills the pipeline with lots of women who are qualified to serve in executive-level positions.
The twenty first century is poised to become the century of the feminine corporate if the pressure to induct women in boardrooms is anything to go by. The stone age tarot that said women must replicate patriarchal leadership paradigms can be subverted if women fill half the boardrooms. If women can manage countries, it is hypocritical to assume they will not bring newer ways of conflict resolution and newer ethical accountability to firms. The merry financial skullduggery that brought the world to its knees in 2008 might just be avoided if we end this female quarantine.
Sundeep Khanna is a consulting editor at Mint and oversees the newsroom’s corporate coverage. The Corporate Outsider will look at current issues and trends in the corporate sector every week.