Women in boardrooms: Speeding up the progress in Turkey
“We can’t all succeed, when half of us are held back” said wisely Malala Yousafzai, then a 16-year-old women’s and children’s right activist, in her first historic speech at the United Nations in 2013. A simple equation.
In the 21st century, it seems incredible that we are still discussing the case for gender diversity and working to convince businesses and governments of its importance. The case for more women in leadership roles is clear, but progress is achingly slow.
This is despite ample evidence that companies perform better when they have women on their boards. A 2016 OECD report, for example, showed that companies with gender-diverse executive committees achieved 47 percent higher return on equity and 55 percent higher gross income than companies with less diverse boards. A 2018 Harvard Business Review survey of 1,700 companies found a “statistically significant” relationship between diversity in leadership and increased innovation.
Our work with the private sector globally to promote gender diversity has shown that having more women on boards has a strong impact on corporate governance, decision-making, and business results.
Despite the increased awareness, however, much work remains. In Eastern Europe, women held only 8.5 percent of board positions as of 2016, according to the International Labour Organization. Here in Turkey, the situation is slowly improving, but still below the EU average. According to Sabancı University’s Women on Boards Report, only 15 percent of supervisory board positions of listed companies were held by women in 2018. What steps can be taken to speed up progress?
Moving the needle in the right direction is only possible through a comprehensive program of support. First, it’s crucial to ensure that women actually stay in the work force. While there’s a near equal divide between the numbers of male and female entry-level workers in many countries, as workers move into mid-career managerial posts, gender imbalances become more apparent, mainly because of the number of women who drop out to focus on family.
Implementing women- and family-friendly workplace policies such as flex-time arrangements and child-care benefits, and encouraging women to return to work, can help prevent that loss. Our 2017 report, “Tackling Childcare: The Business Case for Employer-Supported Childcare”, demonstrated the rising recognition among policymakers and businesses of the benefits to addressing these issues.
The second challenge is to cultivate talent by investing in women’s professional development. Exposing more women managers to key operational responsibilities and preparing them for the boardroom are key. For example, in Eastern Europe, women represent 25–40 percent of mid to senior level management. But a look beneath this statistic reveals clear stratification by gender and job function. Female managers typically supervise departments supporting core business functions, while male managers oversee key operational and financial units.
There are also other gender differences—most likely accumulated from years of conditioning—that should be addressed. Even the most accomplished and experienced women often benefit from training and coaching on how to assert themselves, how to tap into their strengths to build their personal leadership style, and how to communicate in high-powered, male-dominated settings. Corporations can help by modifying their training programs to account for these differences.
In Turkey, our support for the “Women on Board” agenda has been anchored in our long partnership with the Independent Women Directors project, which has become the Turkey Chapter of the 30% Club, a global campaign to improve gender diversity on boards. In 2017, we saw most of Turkey’s business groups joining the 30% Club—a reflection of the private sector’s growing commitment to advancing gender diversity.
It is heartening to see Turkey’s businesses taking powerful steps in the right direction. Especially in these economically trying times, when the economic cost of leaving women out of Turkey’s boardrooms is too great and the potential gains are too valuable. This is the time when smart, effective boards are needed most.
As a large investor in Turkey, the International Finance Corporation (IFC) remains committed to making gender diversity a priority for corporate boards. Our aim is to contribute to a culture shift, where the business benefits of gender diversity in the boardroom are better appreciated. It is a long journey – but we are in it for the long-haul.
* The International Finance Corporation (IFC) Regional Director Europe and Central Asia