Line workers Blessing and Opeyemi in Nigeria

Photo Credit: NPSP

Making the Case for Women’s Integration in Africa’s Energy Sector

To create a responsive, efficient, and sustainable energy sector, stakeholders across the sector must capitalize on the talents and meet the needs of African women and men.

The Business Case for Women’s Participation

A growing body of evidence demonstrates a strong correlation between gender diversity and a company’s financial performance. Across multiple sectors, and all around the world, organizations and companies with a greater share of women on their boards and in senior management see higher returns on investment.

This data is as relevant to the energy sector as any other. An index comparing the performance of power utilities demonstrated that the top 20 most gender diverse utilities significantly outperformed the lower 20 in return on equity.¹

This correlation exists when looking beyond management, across the workforce writ large. Companies with greater gender diversity in the workforce benefit for a number of reasons. They access a larger talent pool, employ individuals who better reflect their consumer base, and demonstrate more balanced decision making; all of which contribute to improved performance.

This correlation does not prove causality; in other words, greater gender diversity does not automatically translate into greater profit on its own. Nevertheless, the data indicate a statistically significant correlation between a company’s commitment to gender diversity and its performance.²

Gender diversity in the energy sector is a business imperative, not an equality directive. The issue of gender diversity should not be interpreted or implemented as ‘Men vs Women;’ rather the more valuable message is that ‘diverse workforces are stronger and more effective’.

The Data

A return on investment analysis of 200 utilities found that the top 20 gender-diverse utilities significantly outperformed the bottom 20 in terms of return on equity, with a 1.07% difference between the two groups. Given that utilities are so asset-heavy, this difference is significant as it could result in millions less in profit.

Companies with three or more women in senior management outperform companies with no women at the top. In Africa, companies in the top quartile with regards to women’s representation in management outperform peers by 14% on average.

Sources:

1. Ernst and Young, Talent at the Table: Index of Women in Power and Utilities, 2014 and 2016
2. McKinsey, Women Matter Africa, 2015

The Business Case for Women’s Access to Energy

Men and women experience energy poverty differently. Furthermore, when men and women have access to electricity, they tend to use it differently. Decision makers cannot make “gender blind” decisions - at the policy, project, or product design level - and assume that men and women will benefit equally. Understanding gender-based differences in energy needs, uses, and access, allows the various stakeholders across the sector to better meet the demands of the population they aim to serve.

Women are important but undervalued customers; a sector that aims to meet their needs capitalizes on an important and growing customer base. Evidence suggests that women can be strong ambassadors for rural electrification, referring new customers to off-grid solar companies; a significant benefit to growing companies.³ Since women show a great interest in home-based energy technologies, their input is valuable to the design and implementation of products or projects that aim to meet their energy needs. Acknowledging gender-based differentials and developing policies, projects, and products with these in mind allows the energy sector stakeholders to be responsive to a broader customer base.

A Call to Action

Two out of three people in sub-Saharan Africa lack access to electricity, and many of those who are connected to the power grid are adversely affected by extensive outages. Tremendous opportunities exist to tap into Africa’s human and natural resources to transform the energy sector. The data suggests that engaging women to help lead this transformation can only benefit the sector. To this end, organizations in the power sector should proactively:

• Develop gender-sensitive management policies to create inclusive work environments. Examples include developing strategies to recruit, retain, and promote women in the workforce, as well as anti-harassment and parental leave policies.
• Conduct a gender analysis to ensure that policies, projects, and products equally meet the needs of women and men. Correct the course of activities that adversely impact livelihoods or fail to benefit women or men.
• Develop financing mechanisms to promote women’s access to electricity and facilitate female entrepreneurship in the sector.
• Collaborate with local universities and vocational programs, creating bursaries or internships for female students.
• Use gender-sensitive indicators, and collect and disaggregate people-level data by sex in order to measure the extent to which men and women are benefitting from project activities.
• Ensure gender considerations are addressed in energy sector policy development and planning processes. Engage with gender ministries, gender equality focused NGOs, and women’s business networks to identify energy related needs, address barriers, and capitalize on opportunities.

Endnotes

1. EY, Talent at the Table: Index of Women in Power and Utilities. 2014 and 2016
2. Catalyst, The Bottom Line: Connecting Corporate Performance and Gender Diversity. 2004
3. Greentech Media: “Why Gender Is Key to African Off-Grid Solar Energy Sales.” 2018