Gender inequality is still prevalent in many communities across the globe. Women and girls continue to share a disproportionate burden of poverty, hunger, inequality and violence, while gender imbalance persists within a vicious cycle of pain and indignity. Although several international laws have been passed and many policy measures have been adopted, gender equality remains one of the most pressing social, economic and political issues affecting modern society.

A MULTI-FACETED APPROACH

Identified by the United Nations as the Sustainable Development Goals (SDGs), women’s equality and empowerment are among the 17 SDGs that seek to end all  forms of discrimination against women and girls everywhere.  Gender equality encompasses women’s rights to access  economic resources, financial services, justice, ownership  and control over property, inheritance, natural resources, and  more importantly, to get equitable pay and representation at  the boardroom table. However, these goals would fail to reach any far without considering the complex and multifarious  nature of a gender-equal world. 

Professor Naila Kabeer from the London School of Economics  Department of Gender Studies defines women empowerment  as: “A process by which women gain the ability to make and  enact strategic life choices. Critically, women are the agents  of the change process”. Prof Kabeer contends that to be truly  empowered, women must have the rights and freedom to  make choices and decisions for themselves, their families,  communities and environment. 

Engaging women and girls in sustainable development  requires a change in attitudes and behaviours towards women  and girls. Societal changes are required to challenge deeply rooted norms and expectations about power and privilege,  and to create an enabling environment for gender-based  activism to find expression.

IT STARTS WITH FINANCIAL INCLUSION

According to Leora Klapper, Lead Economist at the World  Bank and Founder of the Global Findex database, achieving  any UN SDGs – poverty eradication, gender equality and  quality education - begins with having a financially inclusive  world. 

Financial inclusion is a critical component of social inclusion  and represents a fundamental global development agenda.  In this regard, women’s access to financial services rightfully  ranks as one of the leading sustainable development targets,  forcing many countries, including Islamic countries, to adopt  financial inclusion strategies.

Islamic finance can contribute meaningfully to the global  reform agenda defined in SDG-5 concerning women  empowerment. By its inherent nature, Islamic finance  principles are rooted in social justice, inclusion, and sharing  of resources to achieve prosperity and social well-being for  all. The risk-sharing instruments of Islamic finance, such  as musharakah and murabaha, and its social redistributive  mechanisms like zakat, sadaqa and waqf, can undoubtedly  bring positive and sustainable changes. 

As Islamic banking and finance become increasingly  widespread in the Middle East, Southeast Asia and North  Africa, there are significant differences in financial inclusion  and integration of women across these countries. 

Whilst Malaysian and Indonesian women are making  significant strides in Islamic finance, women in the Middle East  have only started to see the tides changing. The situation in the  Northern regions of Africa, India, Pakistan and Bangladesh is  not different. It is clear that women’s access to Islamic finance  varies depending on geographic spread. Islamic finance’s  urbanisation also poses a challenge for its effectiveness as  a valuable tool to achieve the SDGs. Rural communities,  suffering significantly more from mainstream economic  exclusion and deprivation, are further denied the offering that  has the potential to take care of their needs. 

Whilst the growth in FinTech can serve as a bridge to  overcome this challenge, digital adoption across the globe  is still slow and has spurred only recently because of the  COVID-19 induced lockdown and social distancing. Digital  finance has the potential to transform the economic prospects  of women because of its ability to address a number of the daily restriction women from various backgrounds and  cultures face – the limitation on free movement, the demands  of family life and even resistance to engage face-to-face with  males in financial institutions. However, it is not without risks.  Hacking, identity theft and aggressive marketing are but  some of its ills. 

Along with the generally low public awareness levels on  financial and technological literacy, this consumer base’s  vulnerability is further compounded.

REPRESENTATION OR QUOTAS FOR FEMALE LEADERS

In September 2020, Reuters reported that women are sorely  underrepresented in financial services, focusing on the Gulf  Arab region. Some may challenge this point with the growing  list of women in senior positions ranging from CEOs of leading  banks to presidents of FinTech companies and chief advisers  to the Islamic banks. Change is undoubtedly on the horizon,  but there is caution against the achievement of quotas on  leadership boards and advisory councils, if it serves purely as  tokenism and a scorecard accelerator. 

In other research done by the Boston Consulting Group, it is  reported that women are generally offered ‘dumbed down’  products when, in reality, they want the same products as  offered to men. Women want their products and investment  options developed in a way that acknowledges their diversity  and reflects their values and preferences, such as higher  female life expectancy, interruptions in careers due to family  planning so on and so forth.

PERSPECTIVES

As long as financial services fail to embrace these differences  and do not strive to be truly inclusive and accessible, female  leadership participation will remain a lost opportunity, and the  industry will continue to under-serve women.

ISLAMIC FINANCE SERVING THE NEEDS OF WOMEN

Islamic finance can be one of the most powerful, liberating  and enabling tools to drive women empowerment. At this  critical juncture when Islamic finance is coming into its own,  it must seek to balance supply-side factors with consideration  for the specific demand from its various stakeholders, with a  particular focus on the unique needs of women, from those  in rural communities to the one urbanised and to the ones  challenging the glass ceiling.

Differentiating its services with exclusive offers has already  attracted many women - both Muslim and non-Muslim - and is  setting Islamic finance apart to reflect the sensitivity towards  cultural and religious dynamics.

If Islamic finance continues on this trajectory, it will be well  placed to provide access to financial services to businesses  and communities in a sustainable way. Doing so will assist in  achieving SDG-5 and also many other SDGs where women,  in their role as mothers, teachers, caregivers and nurturers,  can play a pivotal role for sustainable development in the true  sense of the word.

FINANCIAL INCLUSION IS A CRITICAL COMPONENT  OF SOCIAL INCLUSION AND REPRESENTS A  FUNDAMENTAL GLOBAL DEVELOPMENT AGENDA -  IN THIS REGARD, WOMEN’S ACCESS TO FINANCIAL  SERVICES RIGHTFULLY RANKS AS ONE OF THE LEADING  SUSTAINABLE DEVELOPMENT TARGETS