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Why Globalisation Benefits Women In The Workplace

International relationships help to encourage positive change but firms must do more to boost women into senior leadership positions.
International relationships help to encourage positive change but firms must do more to boost women into senior leadership positions.
  • Women are still much more unlikely to hold leadership or management positions
  • Firms often adapt employment practises to keep foreign investors happy
  • Global interaction can improve gender norms in the workplace

If you’re reading this, it’s unlikely that you’ll see gender parity in your lifetime – according to the Global Gender Gap report 2020, it will take another 100 years for women to reach equal status with women in the workplace based on the current rate of progress.

Unfortunately, this is no surprise. Despite all evidence to the contrary, too many people in positions of power still believe negative stereotypes about women, such as they lack ambition or should carry most of the load at home. As a result, it leads women to be perceived as less capable than their male counterparts and their views not being considered equally.

Based on past experience, research shows that economic slowdowns not only disproportionately affect women, but also trigger gender equality topics to slip down governmental and corporate agendas. In the face of the COVID-19 pandemic and economic crisis, efforts will have to be doubled if we are to avoid losing more years to achieve gender quality.

However, it is not all bad news. Research by Vienna University of Economics and Business (WU) has found that globalisation can actually provide opportunities for gender equality in the workplace.

The study, by Professors Alyssa Schneebaum and Carolina Lennon, found that there is a correlation between global economic interaction and the gender distribution among a firm’s employees.

Their findings revealed that firms which export, or that are owned by parent companies abroad have a higher female share of full-time, permanent employees than firms that are only active in their national markets. This was especially apparent for exporters with customers in countries with equal gender norms – these companies employed six to seven percent more female employees.

“Domestically-owned firms hire 17-18 percentage points fewer women than foreign owned firms in the same market that are exposed to gender equality,” says Carolina Lennon, Consultant at The World Bank and External Lecturer in Macroeconomics at WU.

“What we see here is a ‘race to the top’, meaning that global firms adopt more equal hiring practices compared to non-global firms if they interact commercially with more gender-equal economies,” says Alyssa Schneebaum, Assistant Professor of Economics at WU. “There seems to be no evidence of a race to the bottom, that is, gender inequality isn’t imported through commercial links with gender-unequal countries.”

The research reveals that a simple interaction between two different societies is key to improving gender equality because firms in unequal countries adapt their own employment structure to match what is considered the norm, to meet the wishes of their foreign investors.

However, the researchers also found that the percentage of women only increases at the lower and middle levels of the organisations – exposure to gender equal norms has no effect on top management positions.

In fact, being internationally orientated can have a negative effect on the probability of a firm employing a female in a top management position, with exporters 3.9 percent less likely to have a female in charge.

“These results are important because they show how commercial trade serves as a medium through which gender norms can be transmitted across countries. However, we do find that for more prestigious jobs, it will take more than just commercially-based exposure to norms of equality to get more women into management positions,” says Professor Schneebaum.

One reason for the contrast in findings is that is that in developed and relatively gender equal countries, women are still much more unlikely to be in leadership and managerial positions. Just look at the FTSE 100 list; only five percent of CEOs are women. The FTSE 250 is even further behind, with only five female CEOs listed. Unequal societies can’t replicate having more women in senior positions because ‘equal’ societies still haven’t achieved this.

The researchers say that until firms in these circumstances can break their own glass ceilings, we can’t expect gender equality norms in leadership positions to transmit abroad.

However, it is still encouraging to see progress in one country can easily reach another through economic activity. But is important to remember that globalisation cannot achieve complete gender equality alone. This is particularly the case when it comes to top management positions, firms will need to do more if they want to have more women in senior leadership positions.

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