Global gender equality certificate improves competitiveness of businesses
The competitiveness of businesses not only comes from maximizing benefits and protecting the environment but also from diversified gender roles and gender equality.
According to the McKinsey Global Institute, if women would take part in the global economy on an equal footing with men, the GDP of the globe would increase by US$28 trillion by 2025.
It is necessary to raise awareness and change people’s mindset. Particularly in Vietnam, commitments on gender equality are strong, but result in little to no specific action, especially at companies.
In the World Economic Forum’s (WEF) Global Gender Gap Index 2018, Vietnam ranked as Asia’s sixth most gender equal country.
Meanwhile, according to audit company Deloitte Global, Vietnam ranks first in Asia in terms of female leadership in businesses with 17.6% of board members, higher than the world average (15%), while Japan and the Republic of Korea are at the bottom of the list with the ratio of 3.5 and 4.1%, respectively.
However, in fact, there is scant awareness of gender equality in businesses. Specifically, according to UN Women 2016, the salary of female employees is 20% lower than male employees in the same role, and this gap is increasing. For around 83% of management positions, recruiters prioritize male applicants.
According to a 2017 report of the General Statistics Office, women are paid VND887 for each VND1,000 paid for men.
There are even shortcomings related to gender equality in the regulatory system. “The Vietnamese Labour Code aims to protect female employees, so there are many jobs (such as hard physical labor) which only men can do or in which lines the retirement age for women is lower. Therefore, the law should be amended towards the equality of genders,” said Ha Thu Thanh, chair of Vietnam Business Coalition for Women’s Empowerment (VBCWE) cum chair of Deloitte Vietnam.
Thanh stated that gender equality should start at the business community, especially the private sector to create equal opportunities for both genders. At Deloitte Vietnam, women are not restricted by the retirement age. “In Vietnam, the increasing retirement age is an issue. The more time the elderly spend on work, the more barriers younger employees face,” added Thanh.
Positive effects of gender equality on businesses cannot be denied. However, most businesses do not pay enough attention to ensure equality. Vu Tien Loc, chairman of the Vietnam Chamber of Commerce and Industry (VCCI), said: “Although business expenses would increase, they would improve the brand’s image and win over customers. Moreover, the market is trending towards more refined products, which suit the skillsets of women as well as create sustainable value for businesses.”
Global gender equality certification
Economics Dividends for Gender Equality (EDGE) certification creates added-value and raises the reputation of products, as well as improves the competitiveness of businesses.
In Vietnam, VBCWE is the representative organization granting EDGE certification to businesses.
“The EDGE certification expresses gender equality among businesses. This has been applied in numerous countries, contributing to the implementation of the United Nations’ sustainable development goals (SDGs),” Ha Thu Thanh said.
The certification will add value for footwear and seafood companies exporting products to Europe and the Americas.
“In addition to the ISO certification, European and American people are interested in products that have a positive impact on society like EDGE-certified items and the certification proving that no worker under the age of 15 took part in the manufacturing of the product. Accordingly, customers in this region have a good awareness of issues related to the environment, women, children, and disabled people. In addition to competition on quality, the perceived value also affects customers’ decisions. The products exported to developed countries and carrying the EDGE certification will enjoy better reputation and competitiveness,” emphasized Thanh.
In Vietnam, as many as three firms (EVN Ho Chi Minh City, Maritime Bank, and SASCO) have received this certification, while two others (Deloitte Vietnam and Garco 10) are waiting for approval.
Other researches outlined that firms promoting gender equality will increase competitiveness by 15%, especially in technology companies. If there are women involved in businesses’ leadership, corporate governance will be more transparent and crises will be easier to overcome by sustainable development.
“In Malaysia, listed companies are stipulated to have at least one woman on their management board. This is also encouraged in several other countries, while we are promoting gender diversity among board members,” added Thanh. She also revealed that there are only three firms with female members on the management board among the blue-chip VN30 Index. This is a solid start for developing gender equality in businesses.