Women are beginning to play a vital role in GCC businesses – and society’s reaping the benefits.
June 30, 2012 7:03 by Reuters
GCC women in several regional markets are more highly educated than the overall population, and yet suffer greater unemployment rates, particularly in the private sector. Although this is a problem for Gulf countries, regional and foreign investors consider this talent pool an opportunity for growth.
Investors attending the recent Middle East and North Africa Businesswomen’s summit in Dubai were of the view that the highly educated women in the region are capable of driving growth of small- and medium-size enterprises, and they were hopeful of hunting down potential entrepreneurs during the conference.
CEO of Bahrain-based angel investing firm Tenmou, Hasan Haider, said: “Angel investing is an old concept in the West, but such a type of network is in its infancy in the GCC region. We are trying our best to fund projects, especially the ones conceived by women in the region. I am quite hopeful that we will find a few at Dubai’s conference.”
When asked about the investors in the firm, Tenmou said: Our investors include Bahrain Development Bank, which has a 20 per cent stake in the venture, Alba with 10 percent and 14 leading Bahrain family businesses, which will provide 70 per cent of the funds.” The scheme provides business start-ups with an average of BHD20,000 (US$53,047) in return for a 20 percent to 40 percent investment.
Talking about the effect of women business leaders in the Mena region, president of Mena Businesswomen’s Network, Afnan Al Zayani, said: “The long-term growth of a country’s economy increases by 3.7 percent for every year the adult population’s level of schooling increases. Women who obtain secondary and higher education are more likely to be effective agents of change within their communities and countries. MENA ranks highest among all developing regions in the growth rate for female education, and MENA women are more likely than men to attend university.
“Because of this, MENA economies are expanding and women-led businesses are often at the forefront of this growth. Women business owners are optimistic and poised for growth. Between 61 and 88 percent of participants in a recent Women Entrepreneurs survey expressed optimism regarding their enterprises, while between 47 and 87 percent expressed optimism about their national economic prospects.”
These rich women are smart investors too. Wealthy women in the Middle East are increasingly choosing to pour their money into social investments. “Women reinvest 90 percent of their income in their families and communities, compared to men who only reinvest between 30 and 40 percent,” said Al Zayani, adding: “Women’s economic activity results in better bargaining power in the home. More power not only benefits women, but results in greater investments in health and education for children.” A Barclays Wealth survey found that Arab women are the world’s most confident about investing in funds, and the most secure in their knowledge of estate and retirement planning.
In this region, wealthy women controlled 22 per cent, or around $700 billion (AED2.57 trillion) of the region’s assets under management (AUM) in 2010, according to a study by Boston Consultancy Group. The wealth that women in the Middle East control is expected to grow by eight per cent from 2009 through to 2014. They also have an estimated $40 billion in personal wealth.
The women in management positions also impact the growth of companies positively, Al Zayani said: “A 2007 report found that Fortune 500 companies with three or more women on the board of directors outperformed their sector in terms of return on equity, return on sales and return on invested capital. Companies with three or more women in senior management functions score higher than companies with no women in senior roles in terms of leadership, direction, accountability, coordination and control, innovation, external orientation, capability, motivation, work environment and values.