EBRD – Supporting Women Entrepreneurs

for

Forum for South East European Women EntrepreneursIstanbul September 2010

Michaela S BergmanMichaela S Bergman

Senior Social and Gender Policy AdviserSenior Social and Gender Policy Adviser

What is the EBRD?

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• International financial institution, promotes transition to market economies in 30 countries from central Europe to central Asia

• Owned by 61 countries and two inter-governmental institutions

• Capital base of €20 billionCumulative €44.4 billion

Unaudited as at 30 June 2009

What are the EBRD’s objectives?

• To promote transition to market economies by To promote transition to market economies by investing mainly in the private sectorinvesting mainly in the private sector

• To mobilise significant foreign direct investmentTo mobilise significant foreign direct investment

• To support privatisation, restructuring and better To support privatisation, restructuring and better municipal services to improve people’s livesmunicipal services to improve people’s lives

• To encourage environmentally sound and sustainable To encourage environmentally sound and sustainable developmentdevelopment

A network of 36 offices in 30 countries

More than half our bankers based in the region

Net cumulative volume by sector

Financial Institutions 32%

General Industry 12%

Agribusiness 9%

Natural Resources 7%Property & Tourism 4%

Telecoms 6%

MEI 7%

Power & Energy 9%

Transport 14%

Unaudited as at 30 June 2009

Change in labour force participation rates, 1989-2005

-30

-25

-20

-15

-10

-5

0

5

10

Me

n

Wo

me

n

Me

n

Wo

me

n

Me

n

Wo

me

n

Impact of transition:Impact of transition:labour market “separation”labour market “separation”

• Women’s labour participation declined at the start of the transition, but has since recovered

• Women now have lower unemployment rates than men, except in CIS+M

• Women are more in favour of state involvement, particularly in the social arena

• Women tend to be less satisfied with their lives

CEB SEE CIS+M

Source: World Development Indicators 2006

Impact of transition:Labour market “separation”

-30

-25

-20

-15

-10

-5

0

5

10

Cze

ch R

ep.

Est

on

ia

Hu

ng

ary

Lat

via

Lit

hu

ania

Po

lan

d

Slo

vak

Rep

.

Slo

ven

ia

Alb

ania

Bo

snia

an

dH

erz.

Bu

lgar

ia

Cro

atia

FY

RM

aced

on

iaR

om

ania

Ser

bia

an

dM

on

t.

Arm

enia

Aze

rbai

jan

Bel

aru

s

Geo

rgia

Kaz

akh

stan

Kyr

gyz

Rep

.

Mo

ldo

va

Mo

ng

oli

a

Ru

ssia

Taj

ikis

tan

Tu

rkm

enis

tan

Ukr

ain

e

Uzb

ekis

tan

Men Women

Change in percentage points

Source: World Development Indicators 2006

Impact of transition on womenWage equality has diminished

• More wage inequality in less advanced transition countries

• Wage differentials between men and women have increased

• Differences cannot be easily explained by job type or productivity

• Gender discrimination is evident from quantitative and qualitative studies

Sweden

UKFrance

USA

Italy

Slovenia

Kyrgyz Rep

Moldova

Mongolia

Hungary

Uzbekistan

FYRM

Romania

Slovak R.

Albania

Kazakhstan

BulgariaCzech Republic LatviaPoland

Croatia

RussiaEstonia

Georgia

Ukraine

Lithuania

0.45

0.55

0.65

0.75

0.85

0.95

0.45 0.55 0.65 0.75 0.85 0.95

Wage Equality

Labour Force Participation

Impact of transition on womenAccess to finance

• More female managers have difficulty securing a bank loan

• Female managed firms charged higher interest rates in some countries

• Financial development may lead to lower levels of gender bias in bank lending

• More needs to be done to understand constraints and opportunities for female entrepreneurship

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Alba

nia

Arme

nia

Azerb

aijan

Belar

us BiH

Bulga

ria

Croa

tia

Czec

h Rep

ublic Eston

ia

FYRM

Geor

gia

Hung

ary

Kaza

khsta

n

Kyrg

iz

Latvi

a

Lithu

ania

Mold

ova

Polan

d

Roma

nia

Russi

a

Serb

ia an

d Mon

teneg

ro

Slov

ak

Slov

enia

Tajik

istan

Ukrai

ne

Uzbe

kistan

female male

Share of businesses without a bank loan

Source: BEEPS, 2005

Gender and EBRD

• Gender equality - important component of the development and transition process

• Part of Millennium Development Goals

• EBRD’s commitment to expanding opportunities for women and promoting gender equality

• Impact of transition on women has varied by country and by issue

=>Developemnt of Gender Action Plan

PR 9: Financial Intermediaries • To assist FIs in

implementing the Bank’s requirement to promote sustainable development

• To enable the FIs to manage environmental and social risks

• To promote good environmental and human resource management within FIs

EBRD’s Lending to WomenEBRD’s Lending to Women

• 30% Lending to Financial Insitutions for loans to SMEs goes to women entrepreneurs

• Lending to Micro-finance institutions >> Women (no need for collateral)

E.g. MI-BOSPO

PR 9 – Financial Intermediaries Generic PR 9 – Financial Intermediaries Generic Gender IssuesGender Issues

• FI as employer:FI as employer:Women’s employment in this sector is strong and there are good career opportunities.

• FI services: FI services: – Where local laws restrict women’s ability to own land or fixed

assets, requiring land/fixed assets as collateral may make it difficult or impossible for women to borrow.

– Women, particularly poorer women, may lack the skills and/or confidence to be commercially active, including using the services of an FI. This may also make them more vulnerable to exploitation from doorstep loan sharks.

– Women are less likely to have received training of how to develop business plans, demonstrate credit-worthiness, and complete loan applications.

In addition to money In addition to money

• Money is not the sole need – Institutions need to Money is not the sole need – Institutions need to be able to upgrade IT and auditing systems. be able to upgrade IT and auditing systems.

• Upgrading of HR policies to ensure no Upgrading of HR policies to ensure no discrimination and good practicesdiscrimination and good practices

• Integrating gender issues in client’s policies : Integrating gender issues in client’s policies : increasing access to training for women increasing access to training for women entrepreneurs and borrowers, avoidance of –ve entrepreneurs and borrowers, avoidance of –ve stereotyping in marketing stereotyping in marketing

Actions to ensure ComplianceActions to ensure Compliance

FI as employer :FI as employer :– Collect gender disaggregated data at both Collect gender disaggregated data at both

staff and management level. The gender staff and management level. The gender balance on the Board of Directors and balance on the Board of Directors and Management Committees will be important Management Committees will be important to look at. to look at.

– All Performance requirements relating to All Performance requirements relating to labour and working conditionslabour and working conditions

Actions that Promote Best Practice (1)Actions that Promote Best Practice (1)

• FI as employer:FI as employer:– Significant gender imbalances in workforce/management, Significant gender imbalances in workforce/management,

and possible proactive measures to improve gender balance, and possible proactive measures to improve gender balance, should be discussed with FI.should be discussed with FI.

• FI services:FI services:– Mechanisms to ensure that a gender equality focus is applied Mechanisms to ensure that a gender equality focus is applied

in the granting of loans to both female and male-headed in the granting of loans to both female and male-headed enterprises as well as to male-headed enterprises will be enterprises as well as to male-headed enterprises will be important.important.

– The participation of female staff where female staff may not The participation of female staff where female staff may not occupy senior management positions, such as in loan occupy senior management positions, such as in loan decisions, will be important.decisions, will be important.

– FIs keeping statistics of percentage (number and value) of FIs keeping statistics of percentage (number and value) of loans broken down by genderloans broken down by gender

Actions that Promote Best Practice (2)Actions that Promote Best Practice (2)

– Consider gender appropriate modes of loan arrangements – Consider gender appropriate modes of loan arrangements – for example women favour small loans, might find it difficult for example women favour small loans, might find it difficult and expensive to acquire the documentation required by and expensive to acquire the documentation required by banks to verify their businesses, or are unable to provide land banks to verify their businesses, or are unable to provide land as collateral.as collateral.

– FIs should consider identifying opportunities for developing FIs should consider identifying opportunities for developing financial products that target women entrepreneurs and/or financial products that target women entrepreneurs and/or the poorer/rural communities (among which women may the poorer/rural communities (among which women may dominate).dominate).

– FIs should consider providing training in the community on FIs should consider providing training in the community on business development, so as to assist women in developing business development, so as to assist women in developing the appropriate skills and know-how to carry out successful the appropriate skills and know-how to carry out successful business activities.business activities.

New Development

November 2009, 50m November 2009, 50m Euros lent to Garanti Bank Euros lent to Garanti Bank with NDFC and Taiwan with NDFC and Taiwan ICDFICDF

Part of loan agreement Part of loan agreement was to identify and was to identify and promote extension of loans promote extension of loans to women entrepreneurs, to women entrepreneurs, beyond what currently beyond what currently being donebeing done

TAM and BASTAM and BAS

To support economic transition through promotion of the sustainability To support economic transition through promotion of the sustainability of the micro, small and medium enterprise sector.of the micro, small and medium enterprise sector.

Women in Business Programme of TAM and BAS – promotes and Women in Business Programme of TAM and BAS – promotes and supports women entrepreneurs in the MSME sector. supports women entrepreneurs in the MSME sector.

• Provides capacity building and business training targeted at womenProvides capacity building and business training targeted at women

• Targets niche industries with female tradition/female dominated Targets niche industries with female tradition/female dominated sectorssectors

• Provides links with EBRD funded FIs Provides links with EBRD funded FIs

• Assists in creating a support structure to enable work-life balanceAssists in creating a support structure to enable work-life balance

What Else?What Else?

EBRD identified issues and some constraints..

• But what do you think FI’s need to do

• What else can help women entrepreneurs in the region

• What can EBRD do to support?

• Let me know …. bergmanm@ebrd.com