SDG Financing and its impact on Gender Equality
March 29, 2023
Across the world, women are still deprived in terms of the range of assets, rights and economic opportunities. As shown by the recent Gender Gap Report (GGR) by the World Economic forum, worldwide, at the current pace, it will take 132 years to close gender related gaps. On the other hand, more and more evidence has surfaced to show that investing and providing equality in opportunity for girls and women accelerates development progress across all the SDGs.
The GGR also puts Malaysia at 104th position out of 146 countries covered in the report. Indeed, despite the country's progress on many development fronts, gender gaps still prevails as demonstrated by:
- Women’s unpaid care burden and this being a major deterrent to reaching a higher female labor force participation rate (currently at about 51%)
- Women are not returning to the workforce upon taking a career break, compared to men who are more in number and staying longer in the workforce
- Wage gaps continue to exist across sectors and levels
- Occupational segregation which means women tend to be underrepresented in some sectors (usually in science, technology and engineering sectors) while overrepresented in others
- Gender digital divide, more prominent at higher age brackets
- High concentration of women entrepreneurs in MSME sector, some facing barriers to access capital
- Low level of participation in politics and governance (lower than regional average, and when compared to past years)
How can financing promote the country’s gender outcomes? In terms of public finance, a gender-responsive budgeting process involves analysing government budgets for their effect on genders and the norms and roles associated with them. It also involves transforming these budgets to ensure that gender equality commitments are realized.
Why can’t a budget be gender neutral? Women, men, girls and boys often have very different practical and strategic needs and priorities. A gender-neutral policy or budget may not take their needs and priorities into account and/or may produce unintended consequences, including increasing gender inequality.
For instance, tax policies and budget allocations which usually are usually configured based on economic data that are available, will most likely not serve the informal economy and unpaid care sectors well. Both sectors suffer from tremendous lack of data, hence limiting the capacity for the government to draw baseline assessments and make proper estimates of the support needed by the sectors. This is despite their importance to the rest of the economy, and estimates showing that their contribution (if valued at market prices) is worth a considerable amount.
Another example where budget plays a role in gender outcomes is in respect to entitlements to state benefits and pensions. Both are often tied to full-time paid employment over a lifetime. Women who work in the informal economy, or who do not work full-time all their lives because of unpaid care responsibilities will miss out on these benefits.
Similarly, without access to a formal bank account, women are often left without insurance, credit facilities or loans. It follows that budget incentives that employs traditional or digital financial channels will have little impact on unbanked women.
Women’s life expectancy is higher than men, while mostly having worked for a shorter period than men over their lifespan. With subsequently smaller savings and pensions, women would have to rely more on government or their families to provide their material and healthcare needs. Budget for healthcare would have to consider that the healthcare profile of women is not the same as men.
In addition to living longer, women showed higher rates of obesity, non-communicable diseases (such as diabetes, heart failure and high blood pressure) as well as mental health issues than men (1). The 2019 National Health Morbidity Survey revealed that women are more likely than men to experience depression, with rates at 2.6% versus 2.0% respectively. The pandemic lockdown and work-from-home practice in all likelihood have exacerbated the pressure on women’s mental resilience.
The private sector has an equally important role to ensure gender improvements in the country. They must go beyond ‘headcount’ or gender parity and seek to create inclusive work environments where there is open dialogue and learning sessions, family friendly policies and gender-sensitive work conditions. Diversity is important too. Diverse work places fare better in terms of efficiency, innovation, accountability, drive compassion and prosperity for the organization.
A gender lens must be applied to every investment decision if we are to drive better outcomes for gender equality. UNDP’s SDG Investor Maps recommend investments that produce high development impact including in respect to gender outcomes. Applying a gender lens means not only checking whether the investment provides equal opportunities for women but whether it can have a transformative effect on women’s overall economic and social narrative.
Investors have to set more ambitious targets and hold themselves accountable for the achievement of those targets. This includes increasing the availability of innovative financial instruments and mechanisms and mobilize more resources towards increasing (i) access to capital of women entrepreneurs and women-led enterprises, (ii) empowerment of women in the workplace and (iii) investment in companies that promote gender equality.
The compassionate society which is part of the Malaysia Madani philosophy is one that can sustainably provide for the people’s needs through the redistribution of the burden of care and their internalization into the workings of the economy system. One of the ways is through expanding investments into products and services that provide the preconditions for good quality caregiving.
Moving from over-dependence on state-based care system and investing in the Care Economy (CE) will help meet the growing care needs of the young, old, ill and disabled, while also recognize, reduce and redistribute the unpaid care burden borne by the families, especially women.
The support to the care economy holds great promise as a source of paid jobs as well as contributing to the country’s GDP. ILO estimate, for example, that investments in the care economy could create a total of 475 million jobs by 2030, that is 117 million additional new jobs over and above the status quo scenario (2). Medical devices (e.g. wearables and monitoring devices for NCD prevention, advanced diagnostic imaging equipment), supply of suitable infrastructure and assistive technologies to support specific needs of caregiving are just among a few examples of products that can form the basis of CE’s manufacturing activities.
For an upper middle-income country eyeing the high-income path, addressing the nexus between women’s economic choices, including developing the care economy, will accelerate women’s contribution to the Malaysia’s economy and society, unleash growth, add critical human capital, and expedite progress towards the 2030 SDGs.
- World Bank (2021) “Malaysia Country Gender Note 2021” (August), World Bank, Washington, DC.
- İlkkaracan, İ. (2016) The Purple Economy Complementing the Green: Towards Sustainable and Caring Economies.