How should an industry respond when the numbers of women at management and board level is in decline? Glynis Rankin is CEO of Creative Metier, discusses how addressing this trend must be approached through development and support.

Unlike the financial sector as a whole, the microfinance industry has traditionally seen a high percentage of women in senior roles. This has started to decline in recent years – a serious business issue when a high percentage of the industry’s clients are women. This article considers the efforts that have been made to address the situation. Women’s leadership has traditionally been central to microfinance (the business of providing financial services to low income entrepreneurs who traditionally have been excluded from access to financial services). Many of the industry’s pioneers were women, and as microfinance institutions grew, women were well represented in management. To this day, in comparison with other industries the representation of women in leadership remains strong in the sector.

In recent years, however, microfinance providers have seen unprecedented rates of growth, the increasing need to attract technical skill sets from the financial sector, and pressure to become more commercially driven. There is evidence that with these changes in the industry, the percentage of women in leadership positions is beginning to decline. Even within the Women’s World Banking (WWB) network – the only global microfinance network expressly committed to women’s leadership – there has been a decline in women in board positions (from 66 to 40 percent) and in senior management (from 66 to 43 percent) from 2003 to 2009.

There is a strong business case for gender diversity in the industry. Research studies in recent years have demonstrated that increased diversity among decision makers – at both top management and board levels – improves the results of their decisions. But perhaps the most compelling motivation for improving and sustaining diversity in leadership in microfinance is the industry’s client demographics: women are the majority of customers served by microfinance institutions worldwide. Microfinance institutions can capture enormous benefit from more accurately ‘mirroring their market’ and ensuring that customer perspectives are represented in decision making at all levels. So – how has Women’s World Banking chosen to address the challenge of stemming the diversity slide in microfinance? In 2009 WWB launched the Center for Microfinance Leadership with a mission to develop a cadre of diverse, principled and visionary leaders for the future of the industry. The Center serves the top 200 microfinance institutions globally in addition to Women’s World Banking’s own membership.

The Center has set up two initiatives specifically aimed at addressing the gender issue. They began by addressing the supply side. At the individual level, WWB delivers the Women in Leadership Workshop to build high potential women’s skills and ambitions to step into positions of leadership. 122 women from over 30 countries have graduated from the five day programme since 2006. The course gives participants the opportunity to think about their own identity and aspirations as leaders, to set challenging goals, network with other women and hear from industry leaders.

Within six months of the first Women in Leadership Workshop, participants reported that they are better able to focus on goals, identify obstacles to their leadership and understand their organisation’s culture. They also reported new actions and activities in areas including talent management and staff incentives for improved performance, expanded responsibility for new initiatives, delegation of responsibility and improved reporting processes. Participants also reported improved self-confidence both to perform optimally in their current role and to pursue greater leadership responsibilities in the future, a more reflective approach to leadership and a willingness to take risks and promote change.

Working with individual women to build their capacity and drive for leadership is not enough. On the demand side, WWB also works with MFIs to identify institutional barriers to equal opportunity and to design a gender diversity strategy to address these barriers. WWB designed the Organisational Gender Assessment (OGA) methodology to examine gender at the organisational level and to therefore support women at all levels of the organisation and achieve more effective customer representation. The OGA helps institutions to identify the need for change at the three core levels required for gender diversity – vision, policies and culture. The OGA helps MFIs to diagnose and address obstacles, challenges and opportunities faced by women staff members and leaders.

The methodology focuses on four areas – recruitment, retention, promotion and professional development – where women may be challenged in the workplace. An institution may undertake an Organisational Gender Assessment for many reasons: challenges with employee attrition, the fact that a more diverse workforce creates a more innovative, dynamic organisation, investor priorities or other external pressures. The objective of the assessment is to gather and analyse data and determine what actions need to be taken to improve and maintain workforce diversity in the organisation. CEO’s and senior leaders who have attended the Women in Leadership Programme are also benefitting from the Coaching Programme delivered on behalf of Women’s World Banking by Bristol based company Creative Metier. Delegates come together from around the world to a four day programme in Oxford during which they work on the leadership and coaching skills required to develop the next generation of leaders for the future of the industry.

The four day workshop is followed by six months of remote coaching with access to specialist online programmes to support career development and business delivery. The Coaching Programme, delivered to participants from Latin America, Africa, Middle East and North Africa, Central and South East Asia has produced dramatic results in the delegates’ capacity to lead. Remote coaching is used to support delegates in achieving a challenging business objective and a leadership objective.

“I brought together 250 of my staff and since they don’t say what they think I asked them to write down their major issues. We collected these and put teams in place to address the main problems. Now I know that I don’t have any time bombs in the branches and I really got honest feedback.” Fatina Abu Okab, Deputy General Manager/Microfund for Women, Jordan: “In the first three months of this year we were only reaching 40 percent of our targets. In the last two months we are at 60 percent and rising. This is due to the Coaching Program. I am delegating to my staff – they follow through on their ideas and they are getting the results.” Annet Nakawunde, Uganda Finance Trust, Uganda.

So – what has been achieved overall? At the individual level, participants report a clear vision for their own leadership, increased confidence, and significant business results. Attendance on these programmes gives more visibility, commitment to their development and significant increases in promotion as a result.

At the institutional level, significant steps are being taken to support women at all levels of their organisations. There is an understanding of the business case for gender diversity in participating institutions and a long term commitment to change. Women’s World Banking has taken best practice from the corporate sector and applied it across an industry with encouraging results. The impact on the downward trend in women at senior levels in future years remains to be seen, but one thing is clear. The women who have participated in the initiatives set up by the Center for Microfinance Leadership present significant role models for other women leaders in the industry.