Even as the pandemic dealt a blow to women's participation in the paid workforce, companies that focused on measuring and disclosing the gender diversity of their management and rank-and-file employees were able to make strides in achieving gender equity. 

In 2022, women around the world continue to face barriers that impede upward mobility and participation in the paid workforce. Many of these barriers were highlighted during the coronavirus pandemic. While the pandemic had a detrimental impact on labor force participation across the board, female workforce participation was impacted more severely, falling 4% relative to 3% for males on a global basis between 2019 and 2020. As of 2022, global female workforce participation is 46.6%, which materially lags male workforce participation of 72.0%.  

According to the International Labour Organization, the primary reason women of a working-age abstain from the paid workforce on a global basis is due to unpaid care responsibilities, owing to issues such as insufficient support and unequal opportunity for high-quality work relative to male counterparts. This dynamic was magnified during the COVID-19 pandemic as additional caring responsibilities, such as home-schooling, increased the burden on women, including those juggling paid and unpaid labor.  

At the same time, structural barriers such as insufficient parental leave, a lack of flexible working arrangements and support to rejoin work following extended leave, and gender pay inequality can discourage women from participating in the workforce. For women actively working or looking for work, barriers such as biased hiring practices, gender-based discrimination, and a lack of mentorship, career development support, or training can limit upward mobility potential within an organization.

Campaigns by high-profile industry groups such as 50/50 Women on Boards to increase female representation on company boards continue to prove effective. The percentage of women on boards improved 3% year over year for companies in the Sustainalytics coverage universe that reported in both 2019 and 2020, despite a slight decrease in female workforce participation overall. While this is a positive development for female career progression and gender diversity in leadership, research published in our October 2021 report  "Human Capital: Making Sense of One of the Most Common Material ESG Issues" indicates that higher gender diversity on boards corresponded with greater employee turnover. 

The research indicates that the number of women in senior management matters more. Companies with greater parity between the percentage of women in senior management and the percentage of women in the rank and file achieve lower employee turnover. In practice, the data suggest that if employees see equal representation in leadership roles and opportunities for career progression, they are more likely to stay with a company longer.

Between 2019 and 2020, there was a marked 15% increase in the number of companies in the Sustainalytics universe that disclosed the percentage of women in the workforce and women in senior management. According to a 2022 Bloomberg report, investors are increasingly expecting companies to include gender equality initiatives in their business processes and to report on gender-focused metrics. The aim is for the workforce, including senior management, to be representative of the diverse composition of the general population.

Sources:

Reporting on Gender Equity Is a Key Step to Improving Diversity, Upward Mobility for Women

Quotas for Women Aren't Enough to Protect Against Human Capital Risks

Bloomberg Gender-Equality Index