The following article was written by Muhtar Kent, Chairman of the Board and CEO of The Coca-Cola Company, and appeared in The Huffington Post.
It is adapted by a speech he delivered to the Yale World Fund on October 1, 2010. I reblog it in its entirety because it provides a compelling macroeconomic case for women’s business. It’s not about handouts and social service. It’s about good business and growth…for everyone, everywhere.
Let’s discuss the future of our global economy and society. Specifically, I’d like to discuss women, and the role women will play in transforming our global economy and society over the next decade. I also want to share some thoughts on the role women will play in helping transform The Coca-Cola Company over the next decade and beyond.
Like so many of you, I usually start my day with National Public Radio. And driving into work one recent morning, I got stuck in Atlanta traffic and my attention turned to a report on the radio. It was yet another story about China’s rise in the world. Some economists were predicting that China would most likely eclipse Japan as the world’s second largest economy by the end of this year — a full five years ahead of most previous projections.
Perhaps you heard the same report. China’s GDP is projected to grow to more than $5 trillion dollars this year. Of course, a day doesn’t go by without some new breathtaking statistic about China or India or Brazil, or some other fast-growing economy in the developing world. No one has done a better job chronicling the economic rise of the rest of the world than Fareed Zakaria. I’ve had the good fortune of meeting Fareed on a number of occasions and I am always impressed by his fascinating insights on the global landscape. In his seminal book, The Post-American World, he wrote at length about the nations that will be driving the 21st century economy, and the implications this will have on America.
I think there’s another way of looking at this as well — one that goes beyond national comparisons. In fact, I would say that real drivers of the “Post-American World” won’t be China … or India … or Brazil — or any nation for that matter. The real drivers will be women. Women entrepreneurs, women business, political, academic and cultural leaders — and women innovators. The truth is that women already are the most dynamic and fastest-growing economic force in the world today.
Women now control over $20 trillion dollars in spending worldwide. To put that into context — that’s an economic impact larger than the U.S., China and India economies combined. But there’s so much more to the story. Here in the U.S., women-owned businesses account for nearly $4 trillion dollars in GDP. That’s right: $4 trillion dollars in economic output. This alone constitutes the fourth-largest economy in the world. Only the U.S., Japan and China are larger today.
Women’s entrepreneurship doesn’t stop at U.S. borders, of course. It is soaring around the world. In fact, today, one in 11 working-age women is now involved in entrepreneurship. And the highest percentages of women business owners are in markets you might not expect. Consider this: nearly 20 percent of working women in Thailand are entrepreneurs. In India, it’s 14 percent; Argentina, 12 percent; Brazil, 11 percent; and Mexico and Chile 10 percent. And these percentages are rising every year.
So, let’s for the moment forget all the talk about the “China Century” or the “India Century” or the “BRIC Century.” The real story is that the 21st century is going to be the “Women’s Century.” As the world desperately looks for ways to restart and reset the global economy, the solution lies right in front of us. In the words of World Bank President Robert Zoellick, gender equality is simply “smart economics.”
Now, I realize some of you may be scratching your head and thinking — “Why is this guy so interested in women’s empowerment issues?” That’s a fair question. For starters, I have been managed by women all of my life … beginning at birth with my mother. Now Defne and my daughter, Selin, continue that strong management tradition today. I like to think they’ve done a wonderful job.
Selin is also in the early stages of her professional career. I would like to see my daughter flourish professionally in a world that is more just and equitable for women, and where the benefits of diversity are fully appreciated. I also a feel a deep and personal obligation to uphold the legacies of my father and father-in-law — men of great principle who worked tirelessly to promote the rights of all men and women.
And, of course, as a business leader and someone who has been given the responsibility of creating shareholder value for the world’s most recognized brand — I feel a tremendous sense of urgency in ensuring that conditions are ripe for women to thrive around the world.
Call it self-interest … or enlightened self-interest — it really doesn’t matter. Creating a climate of success for women globally is just simply smart business for a consumer-products company. It’s smart business for any company. Empower women and you recharge the world.
In recent months, magazines ranging from Business Week to The Economist have cited studies that show a direct correlation between women’s empowerment and national GDP growth, business growth, environmental sustainability, and improved human health, just to name a few things. The community, social, and family implications are vast. For instance, there’s no question that women influence public opinion inside the home.
At Coca-Cola we have massive banks of information on shoppers and consumers around the world and all of our data points to women as the household opinion elites. Women determine what comes into the home and in what quantity and frequency. It’s probably no surprise to you that women account for the majority of purchase decisions for our beverages. In fact, they represent 70 percent of all grocery shoppers.
At Coca-Cola, we can’t grow our business or reach any of our long-term business goals without greater women’s economic empowerment and entrepreneurship around the world. In fact, no business or economy will be able to grow without this. All the growth projections we’ve been hearing about for the coming years — for China, for India, for Africa, for North and South America — none of it will be possible without women’s economic empowerment.
The only way a projected billion people will rise to the middle class in the next 10 years… the only way the world will grow $20 trillion dollars richer… the only way more nations will rise out of poverty and become more politically stable… will be by women achieving gender parity on a global scale.
If we fail in this regard, the world’s economy will fail.
While business and society have made great progress in recent years, the journey has just begun. We still see too many roadblocks to women’s empowerment. Cultural roadblocks … educational roadblocks … political roadblocks … financial roadblocks, and technology roadblocks, to name just a few. I had a great conversation not long ago with President Obama’s Ambassador-at-Large for Global Women’s Issues, Melanne Verveer. Ambassador Verveer said something very poignant about the persistent lack of access to capital for women entrepreneurs.
She said, and I quote: “Too many of the best business ideas die in bank parking lots. That’s got to change and it will change.” Here I’d like to outline 3 concrete ways that business, government and academia can have a significant impact in generating female empowerment around the globe.
This is the new model. We in business have to think differently about the way we work with and view governments and NGOs. Governments and NGOs, in turn, need to think differently about the way they work with and view business. And academia needs to continue be an impartial filter of the truth — keeping us all honest.
So let me just preface this by saying that these three areas are not nice to-dos … rather they are imperative to our long-term viability.
1. The first way we can help fuel women’s empowerment is the most obvious: Accelerating women’s leadership within our own four walls.
One of the most fulfilling programs I am personally involved in is serving as the chair of our company’s Women’s Leadership Council, which we initiated three years ago. In this role, I work with senior women executives throughout our company to identify strategies to accelerate global recruitment, development, advancement and retention of women.
The program is built around the core focus areas of:
* Building a leadership pipeline
* Creating an enabling culture that values personal sustainability.
* And driving employee engagement within our company.
One area of major concern for our women employees across all of our global geographies is work-life balance. To help ease some of the burden, in 2008 we initiated flexible-work arrangements in North America and provided a global framework and tool kits for our business units around the world.
In addition, we have grown the number of women in upper management level positions across our company, and our female employee engagement rate is now higher than our overall company engagement rate. Today, women hold top leadership positions in our corporate finance group, including our Head Controller, M&A and Internal Audit executives.
Women make up half of our Global Public Affairs and Communications leadership team, and about half of our legal team. We have women in our top science and regulatory, quality and human resources positions. One of our largest and most important global operating units — Europe — is led by a woman, and our operations in my native country, Turkey, is run by a woman.
While we’ve made good progress the past three years, we have much, much work to do. I am holding myself accountable for greater progress. We have aggressive metrics in place that are embedded into our 2020 Vision — our growth path forward for the next 10 years and beyond. We are pushing ourselves to more than double our volume and revenue. We’re pushing ourselves to be among the greatest places in the world to work. We’re pushing ourselves to be even more consumer focused … more community focused … and more environmentally focused.
We can’t do any of that without greater participation of women at our senior ranks, and we know we need to get there sooner rather than later. For Coca-Cola, this is absolutely mission critical. The keen insights women bring to our business are profound, to say the least. As more and more women around the world gain economic power, we need to be there to ensure the right shopper insights, the right mix of products, and the right marketing and merchandising strategies.
This is the message I took to Davos earlier this year when I appeared on a gender-parity panel discussion with Arianna Huffington and Facebook COO Sheryl Sandberg, among others.
2. Another theme that was echoed in that discussion was the importance of bringing more women-owned businesses into our supply chains — which is the second area where business, government and academia can continue to impact massive change. Because of the global reach and influence of our operations, we can be powerful agents of constructive change.
One of the most exciting women’s entrepreneurial development programs we have been involved in at Coca-Cola is our Micro Distribution Center network in Africa. This program allows independent entrepreneurs to set up distribution centers on behalf of our company. Micro Distribution Centers are typically located in areas where a lack of stable roads and infrastructure makes it difficult for delivery trucks to travel.
This independent network of entrepreneurs distributes Coca-Cola’s beverage products to retailers, often by bicycle or pushcart. In fact, the vast majority of our sales in countries such as Kenya, Tanzania, Uganda, Ethiopia and Mozambique are the result of this business model. Nearly a thousand of these businesses in Africa alone are owned by women.
Here’s story of one of these entrepreneurs. Her name is Rosemary Njeri and she has been running a Micro Distribution Center in downtown Nairobi for the last 10 years. She’s a hard-working, hand’s-on business owner who likes to lead by example and is very loyal to her staff. Rosemary has grown her business so successfully that today she employs 16 people, some of whom have worked with her since she started. Two of her salespeople have been able to build their own houses from the income they’ve earned working for Rosemary.
Rosemary’s livelihood has simply blossomed. In addition to her thriving distribution business, she now invests in real estate and she has been able to educate all three of her children. The multiplier effect of such actions are significant.
Today, across our global supply chain, we work with upwards of 10 million women-owned or operated businesses — from suppliers and distributors to retailers — that derive a significant portion of their profits from Coca-Cola. We know there’s more we can do stimulate even greater female participation across our global value chain.
Two weeks ago I met with President Clinton in New York and announced our commitment to reach out and help empower 5 million women entrepreneurs by the year 2020. Now that may sound bold, but I have seen the power and conviction of our system, and when we put our mind to something we achieve results. To achieve this, we’re going to partner with other companies, governments and civil society organizations to bring all of our skills and resources to bear to help break down the barriers that small businesswomen face. Barriers like access to credit, peer networking and basic training. We’re going to give high potential women in our system a chance to champion and manage this work.
There is so much business knowledge across our workforce that we can transfer to emerging entrepreneurs. Basic accounting knowledge, business planning, marketing, merchandising, customer service, and legal advice to name just a few areas. And we’re going to encourage all Coca-Cola associates — men and women alike — to take advantage of this opportunity to support women small business owners through one-on-one mentoring and training.
I should be clear, too, that this kind of initiative will also reach millions of men who are part of this vast network. All boats will rise. As our suppliers and retail customers gain greater skills and empowerment, their businesses will reflect this. And Coca-Cola’s business will reflect this. We are all in this together. We’ve seen, time and again, that as women rise in their communities — the communities themselves rise to new heights of prosperity and health.
3. This leads directly to the third area in which business, government and academia can help promote global women’s economic empowerment, and that is by staying committed to sustainability initiatives.
In this economic environment, there has been lots of discussion across the business world about cutting back on corporate sustainability initiatives. That’s extremely short sighted as this is exactly the time to recommit to these programs.
Whether it’s, educational initiatives, environmental programs, human-health programs, cultural programs or economic-development initiatives — all of these touch and influence women’s empowerment and entrepreneurship. Everything is inter-related.
We have experienced this countless times in the communities we serve in over 206 countries. As you might imagine, water is a huge focus of our sustainability efforts at Coca-Cola. It is central to our business and to our future. Water is also a fundamental women’s economic empowerment issue.
Here’s one example. In Mali, we dug a well in a rural village so that women wouldn’t have to spend 8 hours a day walking back and forth to a clean water source. The savings in time allowed these village women to reinvent their lives. Guess what they did with their new freedom? They started their own catering and events business. This well-drilling program, by the way, was developed by one of our young female managers at Coca-Cola.
Which brings me back full circle. Smart organizations — and those that succeed over the next decade and beyond — will understand that the 21st century is the “Women’s Century.” Women’s economic empowerment and entrepreneurial growth will drive the world’s economy. It’s not a matter of “if” — but rather a matter of “to what heights.” For all of us in business, government, education and civil society — the implications will be vast and profound. Everyone’s success will be contingent upon women’s success.
This is not a battle of the sexes. Far from it. This is a battle for preserving and enhancing the world’s economic, environmental and social fabric. It’s just that simple. No one knows this more than Yale which has flourished to an unprecedented level these past 40 years as a coeducational institution.