Asia’s $89 billion sexism issue


Barron's Asia

Asia is quite the gender paradox, a world leader in sexism despite empowering more female leaders — in Bangladesh, India, Indonesia, Nepal, Pakistan, the Philippines, South Korea, Sri Lanka and Thailand, with Aung San Suu Kyi now de facto ruler of Myanmar — than any other region. That includes China, where Soong Ching Ling served as honorary president in the early 1980s.

The United Nations estimates that failure to accommodate female talent costs Asia about $89 billion a year in squandered output. It’s as bad as economics gets: a region looking to raise a few billion out of poverty blowing the annual gross domestic product of Ecuador on retrograde gender mores.

We’re talking not just developing countries but Asia’s most powerful economies perceived as getting misogyny in check. When Park Geun-hye became president in 2013, for example, South Korea ranked 111th on the World Economic Forum’s annual gender gap report. Today, her economy is 115th, trailing Burkina Faso and Maldives. Japan moved up to 101st from 111th when Shinzo Abe began his premiership in 2012. But while more Japanese women are entering the workforce they’re falling further behind in wage equality, access to managerial jobs and numbers in technical fields.

What gives? Part of the disconnect is that Tokyo games the system. At times, Abe’s government has had as many as five female Cabinet members, the most since the early 2000s (as of October, Abe’s Cabinet had only three). And Abe’s pro-women rhetoric gives him a bell-curve advantage in this male-dominated region. The real problem, though, is a lack of political will in patriarchal Japan that holds lessons for the rest of Asia.

Abe’s “womenomics” program suffers from tokenism. The common thread between the Cabinet jobs he offers women is that they’re the second-tier ones no power players want. Why hasn’t Abe named women to run key ministries like foreign affairs or finance, or act as Cabinet secretary? Because it might disrupt male harmony. Even when Abe did tap a woman to handle the trade and industry portfolio for a short time, Yuko Obuchi wasn’t allowed near the Trans-Pacific Partnership trade negotiations.

Symbolism also belies the rise in female labor participation. The rate for women is now at a record 65.4 percent (versus 82.3 percent for men) — just what an aging, immigration-resistant nation needs. Yet “all the hype about more women working overlooks the fact that most of these are non-standard jobs with low pay, little job security and limited career prospects,” says Jeff Kingston, head of Asian studies at the Tokyo campus of Temple University. Or as a Japanese lawmaker told me recently: “Companies are using women the way you Americans use Mexicans: for jobs most won’t do and for less compensation.”

That’s why things aren’t working as Kathy Matsui envisioned back in 1999 when the Goldman Sachs Japan strategist began churning out womenomics reports. Her basic thesis: if the female workforce matched that of men, Japanese gross domestic product would surge by 15 percentage points. And that’s why as the prime minister mulls an Abenomics reboot, empowering women should be an obvious top target.

Not a single Nikkei 225 company, remember, is run by a Japanese woman. Full-time female workers in Japan still take home an average 30 percent less than men, the third-widest pay gap (trailing Estonia) among Organization for Economic Cooperation and Development members. Abe rarely misses a chance to say he wants women to “shine.” Three years on, that’s become an unfortunate metaphor for “Abenomics”: ideas that attract attention, but with little substance.

Nothing in the Abenomics tool kit twinkles more than the platitudes about gender equality. So what can Tokyo do to better utilize half its population? The first is slap quotas on Japan Inc. Begging executives to do their best to hire and promote women isn’t enough. It’s time for mandatory numbers and penalties for companies that fall short.

Next, encourage women to lean in, in the Sheryl Sandberg sense. One way is to create the female role models Japan lacks. The next time Abe shakes up his underperforming Cabinet (today wouldn’t be a moment too soon) replace Finance Minister Taro Aso, 75, with a woman. With Japan in its second recession in three years, it’s time for new energy and genuine diversity. Also, stop rewarding mediocrity. It’s nice that Keidanren — the Japan Business Federation — this year named the first female executive in its 70-year history. That it took so long should be highlighted by the media as a badge of shame, not an act of courage.

Men must lean in, too. One of Matsui’s signature jokes is that there’s no glass ceiling in Japan — just a thick layer of men. If social justice won’t motivate the graybeards running Japan Inc. maybe money will. A wide range of research shows companies with high percentages of female board members are more productive, innovative and profitable. It’s also worth noting that Japan’s declining birthrate is intricately linked to life-work imbalances.

“The key,” Kingston says, “is to get Japan Inc. to figure out how to do what other industrialized economies have done: retain women workers in good jobs and allow them to resume their careers after giving birth. This is not rocket science.”

You’d think it is, though, for salarymen. Changing male attitudes is vital to enticing more women into the workforce. In an April survey, the Intelligence HITO Research Institute found that 75 percent of working women in Japan don’t want to become managers or directors. That apathy reflects an unwelcoming work environment — inflexible hours, mandatory overtime, late-night drinking with the boss and a male-centric promotion system. Also, “maternity harassment” remains rampant. A new government survey found that 49 percent of women on the temporary contracts that are becoming the norm were mistreated returning to work post-pregnancy.

In short, Abe needs to prove that womenomics is for real, not some national corporate-social-responsibility exercise. Japan may be a G-7 nation, and Abe may be on the case, but the country ranks behind two-thirds of the earlier-mentioned Asian nations that had female leaders. That’s a paradox all its own, but the bad economics at play here is straightforward.

William Pesek, executive editor of Barron’s Asia, is based in Tokyo and writes on Asian economics, markets and politics. www.barronsasia.com