BCG Report Reveals the Six Imperatives to Empower Women Leaders of Tomorrow in the Kingdom of Saudi Arabia

The subject of gender diversity is still an emerging one in the Gulf Cooperation Council (GCC) region – where levels of engagement differ across countries, industries, and organization sizes; hence, many organizations may be missing out on significant growth potential derived from having a diverse workforce. While female workforce participation in Saudi Arabia may be considered low when compared with its western counterparts, it has grown significantly between 2000 and 2014 to 20%, according to the recently released report by The Boston Consulting Group (BCG) entitled ‘How Organizations In The Middle East Can Stretch Their Diversity Spend’. The report details ways that GCC organizations can fully embrace gender diversity and develop the future leaders of tomorrow for positive organizational and economic impact.  

According the report, gender inequality creates an average global income loss of 13.5%, which can be divided into losses due to gaps in occupational choices and losses due to labor force participation gaps. This figure is the lowest in Europe (10%) and highest in the Middle East and North Africa (27%). Since 2000, almost all the GCC countries have experienced a significant improvement in women's participation in the labor force. Saudi Arabia, in particular, is at 20%; however, what has come to the fore is that the increase in women's workforce participation, in Saudi Arabia, has been accompanied by an increase in the female unemployment rate. This is partially driven by higher education attainment that was not matched by an increase in relevant opportunities in the labor market – the share of the female population that completed upper secondary education in Saudi Arabia has almost doubled from 23.5% in 2000 to 45.7% in 2014.

“To develop and empower the female leaders of tomorrow, CEOs and senior leaders should integrate gender diversity as a core part of the organization's strategic objectives and ensure organization-wide communication and engagement. In particular, the commitment of middle management will be critical, as that is who engages every day with employees, and is responsible for performance assessments and promotions,” said Dr Leila Hoteit, Partner and Managing Director at BCG Middle East.

Large organizations in the GCC have been particularly successful in implementing cutting-edge flexible schemes and arrangements for female employees. However, initiatives are successful only if they tackle the right issues and implement strategic plans that can sufficiently attract talented GCC women, such as the implementation of flexible working arrangements and inclusive policies.

Diversity and Inclusion: Identifying Barriers and Bridging the Gap

In many GCC countries, cultural bias still exists, and women are perceived as unsuitable for some jobs or positions. Regulations can also represent a barrier to gender diversity despite significant improvements in the past five to ten years.

Cultural bias and lack of supporting environment – In an environment where there is still a cultural bias against women working in specific industries or roles, adopting quotas can be a winning strategy in the short term - a way to jump the cultural bias barrier by “forcing” the trend. However, the decision to impose a quota or not depends on the country’s context and the leadership’s belief on whether progress can truly be achieved without the push of quotas. For example, one financial institution in Saudi Arabia successfully set targets for both recruiting and retaining women. This enabled it to reduce female turnover from almost 30% to 13% in 2015. In the same company, all women who took a parental leave returned to work after the leave.

Regulatory barriers: the case of KSA - Saudi Arabia is a perfect example of a country where regulations shape gender diversity initiatives. In the past few years, the government has set ambitious targets for women’s participation in the workforce and has loosened some of the labor laws related to working women. According to Vision 2030, 30% of women are expected to participate in the labor force in 2030 (today it is around 20%). The perception of working women is also changing among employers and Saudi citizens in general.

Six Actions to Empower Women Leaders of Tomorrow in the GCC

To develop and empower the women who will be leaders of tomorrow, six actions should be taken:

1. Including gender diversity as a strategic objective - Organizations should make gender diversity a core part of their strategic objectives and keep it at the top of the agenda by embedding the gender diversity agenda in the organization values; explicitly mentioning gender diversity as a strategic objective; developing specific KPIs on gender diversity to be monitored regularly and reported to the top leadership and/or published in the organization's sustainability report; and adding women-related topics to the corporate social responsibility effort.

1. Ensuring engagement of the senior leadership and the middle management - A major obstacle witnessed by many organizations was limited engagement of top management in gender diversity initiatives. Few leaders engage and communicate internally on gender diversity. Consequently, middle management is generally not well informed, creating disconnect between the intentions of senior leadership and actual operations.

1. Fostering retention of high-potential women - In order to significantly and sustainably foster high-potential women pursuing longer-term careers with current employers, organizations should adopt best practices by ensuring the organization is increasingly perceived as an attractive place for women to work. While it is critical to ensure the continuation and extension of flexible working arrangements by removing the stigma associated with them and making them available also to male employees, it is also important to promote an inclusive culture and policies, leveraging both formal and informal channels.

1. Promoting development of women - Providing trainings dedicated to women, to help them to build on their strengths and overcome potential challenging areas, in the current male-dominated work environment, such as workshops on "mental toughness," "how to speak up," or "build your personal brand" have proven successful, as has instituting development programs aimed at women, such as leadership programs and networking events tailored to women.

1. Advocating for women in leadership through positive promotion of role models - The limited number of female role models in certain positions was also mentioned as a major obstacle by interviewed organizations, and women themselves are often held responsible for the lack of role models. Listening to and being inspired by other women is an effective way to gain confidence and increase success and further development. The focus on role models with the promotion of female CEOs and the inclusion of women in governments has achieved impressive results in the GCC.

Saudi Arabia, which had the largest gap to bridge, has seen significant progress over the past few years. Over 60% of the employees of an energy company in Saudi Arabia, when interviewed, recognized the progress made by their employer over the last one to three years in improving gender diversity at all levels of the company. In addition, the recent appointment of two female leaders in Saudi Arabia made the headlines in the region, with the first female chairperson heading Tadawul, the Saudi stock exchange, and the first woman executive director for the Dammam Airports Company.

1. Ensuring fairness and removal of conscious or unconscious biases - Another critical area is addressing the potential unconscious gender bias with leaders and managers in charge of evaluation and performance management processes. Tools to address this issue are: widespread communication of the gender diversity agenda, and organizing and conducting training aimed at male employees, specifically for removing the bias in hiring women and for developing and promoting them.

“Retention, advancement, and leadership-building are the key areas on which organizations should focus. Applying best practices in retaining talent, ensuring fairness and equal opportunities, removing any conscious or unconscious bias, and promoting role models are the key tools,” concluded Dr Hoteit.