Encouraging female entrepreneurs
Econ omist Intelli gence Unit
In an interview with the Economist Intelligence Unit, Mary Ellen Iskenderian, President and CEO of Women's World Banking, highlighted why gender equality across corporate networks is vital for future global growth.
Many multinationals are not yet addressing the issue of gender equality in their supply chains because it's perhaps a sequential issue. One of the most effective ways to ensure gender equality across the sourcing networks of companies is just by becoming more aware of it. If this is something that is seen to be important, then boards should be requiring management to report on gender statistics. Diversity of suppliers is often very important to women working within a company - in effect, it almost becomes a retention issue. So the importance of finance to building gender equality in a supply chain cannot be overestimated. It is the number one constraint stated by women-led companies. Best practices in supply chain finance for women entrepreneurs is still emerging and is fairly nascent. Recognising that a female entrepreneur is not going to have collateral to pledge against a loan, but she might have that a fixed agreement with a buyer, so I think that a bank's willingness to be flexible in the way they provide the finance, and not insisting on collateral, may be the way forward. It may simply be an issue of how regulators define 'collateral' in emerging markets, so not to specifically require 'built property' which is something that men are more likely to own than women. It may mean that banks who recognise the assets that women do have take a different view and adapt their lending to those women, are the ones who can really succeed. In many of the countries we're working in, if the bank wants to lend to an SME they have to put up a 100% capital charge against that loan, which is a very onerous requirement. Regulators who recognise that these SME sector, who cold become part of the global supply chain for some of the corporates, represent a huge opportunity for economic growth and job creation in their countries.