Macro Forum: The Street View

Macro Article

Equality in Africa

Rosalind Kainyah MBE

by Rosalind Kainyah MBE
Guest Author, Founder and Managing Director, Kina Advisory Limited

Equality in Africa Image

Ladybird Logistics Limited ©

If you’re a woman, you’re nearly twice as likely as a man to lose your job as a result of the COVID-19 pandemic.  If you’re Black in either America or Britain, you are almost three times more likely to die from COVID-19 than white Americans or Britons.  Throughout the pandemic, the disabled have been ‘abandoned, forgotten and ignored’.  And the gap that exists between the rich and the poor will almost certainly be widened.  This is a relatively narrow conceptualisation of inequality, but it nevertheless acts as a stark reminder that we live in a staggeringly unequal world, which only seems to be getting more so. 

Across Africa, inequality is pervasive, complex but often obvious. This is more than income inequality but includes more ingrained inequalities.  Inequality based on race, ethnicity, tribe and gender often exacerbate economic inequality. 

The 2016/2018 Afrobarometer opinion poll suggests that 55% of Kenyans, 51% of Nigerians and 26.4% of Ghanaians feel that their tribal group is sometimes, often or always treated unfairly by the Government. In all three countries, ethnic inequality manifests itself in differences in health, education, income and social security, and regional imbalance. Despite apartheid ending in South Africa more than two decades ago, the racial divide in wealth and opportunity remains largely intact. Drone images show the contrast between the well-off gated white suburbs and black townships. 

Gender (In)Equality in Africa

Gender inequality affects every country in the world, so African countries are certainly not the odd ones out. 

Gender inequality manifests itself in multiple ways. In Kenya, access to land and therefore to livelihoods is a major issue. It is estimated that around 32% of Kenyan households are headed by women, but women only hold 1% of land titles on their own.  In Uganda, around 50% of girls between the ages of 15 to 24 are illiterate and four in five girls do not attend high school.  In Côte d’Ivoire, women are 45 percent less likely than men to have a mobile money account which has major implications for their financial inclusion.  These inequalities are further entrenched though cultural and traditional norms which prioritise education for boys over that for girls or job opportunities for men over those for women.

Equality in Africa Image

The different views into the business sector 

The continent’s progress towards gender equality in the workplace looks relatively positive at first glance. In the formal economy, Africa is performing well on getting more women onto executive and board positions. The Boardroom Africa’s 2019 study on boardroom gender diversity shows that among Africa’s top 10 fastest-growing economies, Rwanda has the highest percentage of women on boards at 27%. This is followed closely by Kenya at 24% and South Africa at 22%. The global average is 17%.

These positive developments tend to be success stories for women at the top of the pyramid and not for most African women who work in low-quality and low-paid jobs in the informal economy. In around one-third of countries in sub-Saharan African, the share of women in non-agricultural employment in the informal economy is over 90 per cent.  This is partly because unpaid care work continues to fall disproportionately on women, leaving them with fewer opportunities to find jobs in the formal economy. In Kenya’s formal economy, women get paid 32% less than men according to the gender pay gap.  Worldwide, this figure is reduced to 23 percent. According to the 2019 McKinsey report ‘Advancing women’s equality in Africa’, at the current rate of progress, it would take Africa more than 140 years to reach gender parity.

Expanding Job Opportunities – quantity and quality

While increasing the number of women in leadership positions is essential, we must also focus on women further down the pyramid. Even then it should not simply be about numbers but also about improving access to better-paid and more fulfilling jobs.  Women often have to accept exploitative jobs where they are underpaid and overworked. Even in sectors, such as banking, where there is gender parity at entry point, this parity diminishes as women take time off to have and care for children and then find it difficult to re-enter the workforce.

Impact of COVID-19

The COVID-19 pandemic has and will continue to disproportionately affect women and girls.  In Africa evidence from the Ebola outbreak shows that women found it harder to regain employment or earn an income and that their positions as unpaid caregivers was reinforced as a result of the epidemic.  Even more alarmingly, the United Nations Population Fund estimates that an additional 31 million cases of gender-based violence occurred in the first six months of the COVID-19 pandemic. To address the underlying power dynamics of gender-based violence, women must be economically empowered – this means protecting women’s jobs now and promoting women’s employment in the future.

The Business Case for Gender Equality

Advancing women’s equality could add $12 trillion to global growth by 2025.  In Africa, this translates to an additional $316 billion.  These gains are partly due to the addition of more workers to the labour force but are also a reflection of the positive effect that gender diversity has on productivity.

The benefits of investing in women throughout all levels of business is wide-reaching – reduced costs associated with high turnover; improved productivity; new and improved access to markets; improved community relations and brand value; and access to capital. 

The benefit of female leaders

There is evidence that companies perform better financially by advancing gender equality and diversity in the workplace and particularly where there is a greater share of women on their boards and executive committees. In 2019, S&P Global found that firms with female CEOs experienced a 20% increase in stock price momentum and firms with female CFOs saw a 6% increase in profitability and 8% larger stock returns. African companies are no different. McKinsey’s Women Matter: Africa 2016 report found that African companies with at least a quarter share of women on their boards achieved 20% higher earnings before taxes and interest. 

The “street view” of the business case

Across Africa, businesses – regardless of their size or sector – have experienced the benefits of investing in women employees and establishing gender-sensitive practices. Red Land Roses, a floriculture business in Kenya, found that women’s unplanned leave declined by 25% and productivity improved within one year of opening childcare facilities. The microfinance institution FINCA in the Democratic Republic of Congo developed a network of online agents to provide FINCA’s banking services to low-income customers. They found that women agents were more successful than male agents in connecting with prospective customers, recording on average 12% more transactions a month and 16% higher net profits. 

Empowering women as business owners

However, we must not only empower women within businesses, but also to become business owners.  This requires improving access to finance for women entrepreneurs. Around one third of African SMEs are owned by women, but they face much greater challenges in building up their businesses. This is partly because women are less likely to obtain formal financing and are often required to pay higher interest rates on loans due to the false perception that businesses run by women are higher risk.  Additionally, social and cultural norms often discourage women from embarking on independent business ventures, and when they do, they often lack supportive networks and mentors.  

Conquering gender inequality

We need to go beyond quotas and targets and focus on women as decision-makers and active agents in the global economy. Business leaders can help drive change by:

- Understanding and building their own business case for improving their current level of gender diversity – engaging with women in their workforce throughout the process;

- Ensuring that women are not disproportionately affected by retrenchments resulting from the COVID-19 pandemic;

- Creating gender-sensitive workplaces and practices – for example child-care options and flexible working arrangements. As a side note, there may well be an opportunity to invest in building a reliable and trustworthy care sector (for children and the elderly) – not just as a social good but as profitable businesses.  

- Improving women’s access to better quality jobs through education – in-house and sponsoring young women’s education to develop a pipeline of future skilled workers and leaders.

- Investing in women-owned businesses by incorporating them into their supply chain

Women who are already in leadership or other influential roles, should mentor and sponsor those in the earlier stages of their career and build strong networks, such as WimBiz in Nigeria, to leave a strong legacy of female talent.

And so…

In the words of the late Justice of the Supreme Court of the United States Ruth Bader Ginsburg: “Women belong in all places where decisions are being made” and it is everyone’s responsibility to ensure that happens. It goes without saying, that this also applies to all groups that experience discrimination and unequal treatment. Countries will only realise the full potential of their human capital when everyone is equipped with the skills, resources and support they need – this will go a long way in enabling Africa to capitalise on its demographic dividend to drive sustained economic growth.