Only14%of firms in Latin America and the Caribbean (LAC)belong towomen, andthey hold just 15% of management positions. These aresome ofthe findings of a new IDB Group study that reveals the extent of gender inequality in companiesin the regionandoffers recommendationsto achieve greater equality.
The publication,Leveling the Playing Field: Gender Equity inFirmsin Latin America and the Caribbean , concludes that the main factorsthat increase gender equityincompaniesare the presence of women inhighdecision-making positions, the level of training of the workforce, the use of advanced technologies, and a business culture that is favorable to women.
The study wasproducedby theInstitute for the Integration of Latin America and the Caribbean(INTAL)oftheIDB'sIntegration and Trade Sector,IDB Invest,and theIDB'sGender and Diversity Division.
The report is based on a survey of more than 1,000 companies in 20 countriesin the regionandinterviews with women entrepreneursfromsix countrieson female participationin their organizations, their employmentpolicies, and the impactcaused bythe COVID-19 pandemic.
The surveyrevealeda seriesofdata on gender segregation and the wage gap between women and men in companies in the region. Forexample:
- A woman only holds the top management position in oneoutof every10companiesin the region.
- There is a higher proportion of women in junior positions (36%) thaninsenior ones (25%).
- The female labor presence predominates strongly in"soft" areassuch as human resources, communications,and public relations.
- Women only represent35%of the workforce that uses advanced technologies.
- Almost six out of every10companies do not provideanyadditionalmaternity or paternity leave beyondwhattheircountries'lawsrequire.
- Only28%of thesurveyedfirms reporthaving agender pay gap, of which 34%claimed thatthedisparity ranged between 11%and 20%.
In the interviews, the businesswomen acknowledged having observed salary differences between men and women throughout their careers."Ihave seen men being paid as much as 40%or 50%more than women in the same position and you wonder why given that talent has nothing to do with gender. Addressing this is an enormous challenge for businesses,"said the CEO of a company in the technology sectorinMexico.
What can companies do to improve gender equality?
First, women in executive roles promote greater gender equalityintheir companies.Some key factors are the gender of the CEO andthe percentages of women on the board and women owners. Different econometric models reveal significant differences in this regard,demonstratingwomen'scommitment to gender equality when they reach leadership positions.
Second, companies with a more skilled workforce than the average firm and advanced technologies in their production processes are more pro-gender than the rest. In other words, companies that invest in their employees can create better work environments for their workforce.
Likewise, a business culture that allows flexible office hours andusesgovernment programs for gender equality is anothercriticalfactorinbuildingbetter workplaces for women andimprovingtheircareer opportunities.
Finally, older firms with larger numbers of employeesand seniorityaremore equitable.Themodels used in the study show that the most consolidated firmswith formal human resourcesand salary policies may favor transparency and equal opportunities.
Promoting gender equality inLatin America and the Caribbeanfirms
To increase gender equality infirms inthe region, the public and private sectorsshould1)promote more female entrepreneurship,2) develop more and better labor market policies and measures,and 3)maketrademore beneficialfor women.
On the first point, the study recommends implementing best practices in inclusive public procurement and contracting1and making the most ofnetworks for women in business, such asConnectAmericas, the platform created by the IDB to support the internationalization of LACSMEs.
Firms, governments, and integration blocs should considersomegood practicesto increase gender quality in the workplace,such as removingbarrierstowomen'sprofessional growth,draftingand implementingquota laws for boards of governors and senior positions, longer leaves of absence, and pay transparency.
Third, to promotewomen'sparticipation in the export sector, the study emphasizespromoting new trade agreements and analyzing the inclusion of gender causes that allow women to benefit directly from these impacts or that mitigate the unfavorable effects that trade may have on women.
IDB support for gender equality
As part of its Vision 2025 for economic recovery, the IDB Grouphasestablished five prioritiesto respond to the challenges facing the region and achieve sustainable, inclusive economic growth. One of these priorities is gender equality and diversity.
Under this priority, the IDB leads several programs,including theGender Parity Taskforce,which promotes gender equality within the labor market and seeks to identify barriers towomen'sprofessional development. Another of these programs isGrowing Together in the Americas,which encourages women entrepreneurs to get involved in foreign trade and regional value chains.
For its part,IDB Lab has createdWeXchange, a platform to connect women entrepreneurs with high growth potentialin the regionwith mentors and investors.AndIDB Investencouragestheremoval of obstacleswomen entrepreneurs face,offering them financial products and advisory services to help them build more inclusive businesses.
By working together with LAC governments and businesses, the IDB Group is committed to providing technical and financial supporttoeffortsthatfoster a region with greater gender equality.
To find out more, downloadLeveling the Playing Field: Gender Equity inFirms inLatin AmericaandtheCaribbean.