As a partner in an investment firm that provides capital to start-ups, Prarthana Gandhi has always been mindful of helping early-stage startups. Since 2015, she has been a part of her family business, anAmaya Capital LLP, that has a special inclination for enterprises working in the healthcare domain.
Being a woman leader herself, she is upset by the fact that women still face challenges and hurdles when they choose to have a career. She is also bothered by the low salaries paid to women, even ones in high positions, when compared to their male counterparts. In this chat with Women Icons Network, she tells us how employers can work towards a more diverse and balanced workforce.
Challenges Galore for Working Women
The biggest challenge for a working woman comes in the form of inflexible work arrangements, followed closely by the lack of equal pay, believes Prarthana. “It’s 2021, and women still make less than men. Women of colour continue to deal with some of the workplace’s most entrenched hurdles. Things can be even worse for queer women who are often made to feel like outsiders,” she shares.
Women do not have access to career defining roles like men do, she feels, which results In ripples of consequences. For one, there are not many powerful women role models in most workplaces, she points out. Additionally, not enough leaders are sponsoring highly qualified women to mentor them for positions of power and responsibility which prevents women from speaking for themselves when it comes to policy decisions.
Simple Solutions for Gender Diversity Issues
All of these problems have simple and obvious solutions for those willing to implement them, she says. “Despite making up around 40% of the global workforce, only about 5% of women employees are in the C-suite and upper management positions. Even among them, annual salaries for men in similar positions are not equal. In fact, women earn only 80% of the salaries of their male colleagues in the same position,” informs Prarthana.
A growing body of research shows how greater gender diversity in companies leads to long-term value creation, stability, and even greater returns, she shares. “At the same time, ignoring women as consumers, a group responsible for 70-80% of consumer decisions, means missing out on one-third of the world’s private wealth,” she says, adding that women in key positions can help the company’s product or service become more appealing to these decision makers.
Achieving Gender Equality
“Men have an important role in promoting women’s economic rights and independence, including access to employment, appropriate working conditions, control of economic resources and full participation in decision-making,” opines Prarthana. She believes that true gender equality is achieved when people of all genders have equal rights, responsibilities, and opportunities. Societies that value women and men as equal are safer and healthier, she adds.
Empowering women and achieving gender equality, she believes, requires the concerted efforts of all stakeholders, including businesses. With a growing business case, private sector leaders are increasingly developing and adapting policies and practices, and implementing cutting edge initiatives, to advance women’s empowerment within their workplaces and communities, she shares. They have started addressing issues like equal remuneration for women and men, diversity and equal opportunity, access to sexual and reproductive health-care services, protecting women from workplace violence and harassment and having women in leadership roles.
Women as Entrepreneurs
In patriarchal societies like India, points Prarthana, women are still not financially independent. “Most familial assets are in the name of their male relatives which limits their financial access. A lot of women do not have the freedom to get credit / funds based on the collateral to start a business,” she elaborates. However, she is all praise for the schemes floated by the government as well as SME bank loans that help women entrepreneurs in their startup journey by providing funds without collaterals and at low interest rates.
Education about enterprise, mentoring before starting a venture, career guidance, marketing information, and working capital management are some of the missing essentials for women entrepreneurs, she feels. Many of them even start the execution, but a lack of experience pushes them out of the race in the middle of the journey, she informs. To aid in this, many government and industry bodies organise workshops and meet-ups that help network and enhance one’s skills, she adds.
Another big issue arises for women when they are unable to attend to domestic chores or their kids, she shares. “Women in India are usually stuck between traditions and their dreams. Societal expectation that every woman should prioritise home and kids over her career often leads to a lot of self-doubt,” explains Prarthana. All successful women entrepreneurs, she adds, had great spousal support from the time of initiation of business to running it successfully.
She thinks entrepreneurial success is highly dependent on who you know and networking often is an activity relegated to the big boys’ club. Men often discuss business deals over drinks, but the same could be deemed inappropriate for a woman to do, she feels. “Besides, shyness, lack of awareness, lack of confidence, lack of family approvals and safety concerns usually keep women away from reaching out to the right set of people who may have helped at running their venture successfully, and this hampers their growth,” she shares.
Gender Lens Investing
At its core, gender lens investing (GLI) seeks to close what is commonly referred to as the ‘gender gap’, explains Prarthana. This can be the difference in salaries drawn by men and women in the same position, or in other measures of gender parity within the workplace like the ratio of female employees in leadership positions.
For some time now, there is growing evidence that pursuing gender equity as an investor will have positive benefits for the investment, business, and society, she informs. Among the findings in this direction are:
- Companies with women in executive management repeatedly outperform companies that have no women in senior roles.
- Studies show that diverse workforces support the retainment of talent and employee motivation, and foster creativity and stronger financial performance.
- Globally the purchasing power of women is growing, and companies and investors are taking note of the opportunity in accessing this capital. Entrepreneurs who can effectively demonstrate their ability to empower women will have greater success accessing these capital sources than those who cannot.
“Essentially, GLI is an approach to investing that takes into consideration gender-based factors across the investment process to advance gender equality and better inform investment decisions,” informs Prarthana. This means such investors favour women-owned or women-led enterprises, promote workplace equity (in staffing, management, boardroom representation, and along their supply chains) or back products or services that substantially improve the lives of women and girls.
Sustainable Development and Gender Equality
Prarthana believes that gender equality is at the heart of the 2030 Agenda for Sustainable Development. She feels that none of the United Nations’ Sustainable Development Goals can be achieved if we do not ensure women have equal access to education, healthcare, decent work, and representation in political and economic decision-making processes.
More impact investors have begun to align their strategies with SCGs, and thus are pushing for greater gender equality and women’s empowerment, she informs. However, the usual check-box exercise provides little to no information about the actual impact, she shares.
“This is where GLI comes forward as a powerful new approach since it considers the impact of financial investments, both good and bad, on women and girls. It also recognizes investments’ potential to generate financial returns and advance gender equality simultaneously,” explains Prarthana. She adds that it can also address other sustainability issues, such as climate change, and can help companies to avoid potential reputational or legal risks related to issues such as discrimination, sexual violence and harassment.
The acceptance of GLI can be measured by the fact that it increased by 85% from 2017 to 2018 and reached a value of US$2.4 billion in 2018. In the four years since, the size of these funds has quadrupled. “These liquid, low-fee, and low minimum funds are helping to democratize gender lens investing,” she feels. There’s only one thing she wishes to change in the current GLI scenario – increased female representation in leadership is critical to ensure a diverse set of views and experiences when making decisions, but it is not enough to ensure a positive impact for women and girls.