The Business and Development Cases for Engaging Women in Global Value Chains
Date: 10 May 2011
UN Women Executive Director Michelle Bachelet delivered the keynote address at the Global Business Partnership Forum Event titled “The Business and Development Cases for Engaging Women in Global Value Chains, organized by UN Women, the Turkish Industry and Business Association (TÜSAD), the International Trade Centre (ITC), and the UN Global Compact during the Fourth UN Conference on the Least Developed Countries, Istanbul, 10 May 2011.
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Excellencies, Honoured Guests, Ladies and Gentlemen,
Good morning. I'm delighted you could join us as we take up the issue of women's empowerment. If countries are to achieve sustained growth and social progress, enhancing the economic empowerment of all women is essential.
The impact of the global economic crisis, particularly on poor households, together with the rising cost of energy and food, is straining the capacity of many countries, but particularly LDCs [least-developed countries], to sustain growth and sustainable development.
The World Bank estimates that rising food prices have pushed 44 million people worldwide into poverty since June 2010. In Asia, the Asian Development Bank calculates that a 10-percent rise in domestic food prices could force 64 million people into poverty by the end of the year, if prices remain at current levels. The LDCs have been particularly affected due to their high dependency on food imports. More than 300 million Africans, most of them living in LDCs, lack food security.
The implications for food-importing countries are serious: without sufficient food supplies, at prices they can afford, poor families risk continued malnutrition. On the other hand, one of the reasons for LDCs to import their food is their low productivity in the agricultural sector. While women constitute about half of the agricultural labour force, women have less access than men to productive assets and financial services. FAO has estimated that if women had the same access to productive resources as men they could increase yields on their farms by 20 to 30 percent.
So how does this relate to the global value chain? Gender equality fundamentally shapes the totality of production, distribution, and consumption within an economy.
Women can play a critical role in each node of the value chain: from product conception, through design, production of raw materials and intermediate inputs, marketing, distribution and support to the final consumer. All these points in the value chain involve women as innovators, workers, managers, entrepreneurs and business owners, marketing agents or as consumers.
However, gender inequalities in access to education and training, economic assets and financial services, and hence to jobs, defines the location in the value chain where women dominate, and whether they are informal workers, seasonal workers, or managers.
Let me give you an example, a woman who buys fabric in the morning and sells it throughout the day at the local market, does not generate any value added and hence not a lot of income. By providing her with access to credit to buy a sewing machine, she can add value to the fabric by producing clothes and hence move up the value chain.
Similarly, a global company may choose to buy paprika from local women farmers in Africa, and then ship it abroad for processing to paprika powder. Training of women in paprika powder processing techniques and provision of technology would better tap into the potential of the local women farmers, help them move up the value chain and gain the profits from the value added.
UN Women has developed initiatives to address some of the constraints that women farmers and entrepreneurs are faced with throughout the value chain, such as:
- unequal access to productive resources — land, assets, energy, technology and credit;
- limited awareness of the exigencies of the market (such as norms, standards and quality);
- inadequate support from local authorities and trade support organizations; and
- poor infrastructure, which impacts mobility/transport/access to markets.
There are now proven approaches and solutions to improving women's access to and control over productive resources; increasing local and global procurement opportunities for women-owned enterprises; and strengthening their competitiveness in national and global markets.
In Rwanda, for example UN Women provided women basket weavers with awareness of quality exigencies of the global market and skills for high-quality production to enable them to link up directly with both local and global markets. Their baskets are now being sold at Macy's, one of the largest department stores in New York City.
In Liberia, UN Women partnered with the World Bank, the International Centre for Research on Women and FAO to develop women cassava producers' technical, marketing and management skills needed for profitable businesses. The training in using and maintaining cassava processing equipment and small business management skills allowed women to skip over a number of middlemen in the value chain and hence reap the benefits of the value added to their products.
Businesses also have a critical role. They can revisit their full value chain to identify where women are located, and what kind of support they might need to be able to add value to their products and directly reap the benefits in moving up the value chain.
For example, businesses can invest in and support ITC solutions such as mobile phones and computerized services that can promote more accessible and accountable services to rural women by allowing access to information on market opportunities, e-commerce for women producers' groups, and so on.
The private sector has a critical role in investing in solar energy and other renewable energy sources — in a number of countries, solar power not only allows women's businesses to grow, but also contributes to reduced burden of women to meet their household energy needs.
We have the examples, the strategies, the exceptional local leaders and champions. What we lack is a tightly woven fabric of empowerment that goes from the field to the market, from the cottage industry to the supply chain, from the banks to the schools to the corridors of power.
We need all stakeholders, and in particular, we need solid linkages with you — the private sector — as drivers of innovation, providers of essential capital, job creators and employers.
UN Women together with the UN Global Compact launched the Women's Empowerment Principles to do just that — providing a seven-step blueprint to empower women in the workplace, the marketplace and the community. They offer a tool for a results-based partnership with the global and national business community, and they align with the evidence that empowering women is a strategy for a healthier bottom line.
Particularly relevant for today is Principle Number 5: Enterprise Development, Supply Chain and Marketing Practices, which advises companies to:
- expand business relationships with women-owned enterprises, including small businesses, and women entrepreneurs;
- support gender-sensitive solutions to credit and lending barriers;
- ask business partners to respect the company's commitment to gender equality; and
- ensure that company products, services and facilities are not used for labour or sexual exploitation.
With the help of the Women's Empowerment Principles initiative, UN Women, UN Global Compact and others are bringing to business the strong case of how much women entrepreneurs and women-owned businesses contribute to the economy — reinforcing the realization among leading firms that empowering women is essential to their growth, competiveness and profits.