Ladies and gentlemen,
1. It gives me great pleasure to be back in London, one of the world’s most international cities. One in four Londoners was born overseas, its boroughs are home to more than a hundred languages. Today, this ancient capital sits at the heart of the global economy; a vibrant financial hub, a centre of world-class education, a gateway to Europe.
2. In London, we see what the promise of globalisation can offer. So it is fitting that this is the first place outside the Muslim world to host the World Islamic Economic Forum. That is a testament not just to the openness which fuels city’s success, but also to the Forum’s growing influence. This is fast becoming a serious platform for the exchange of ideas between the Muslim and the non-Muslim world.
3. As Patron of the Forum’s Foundation, I wish to express my deep appreciation to the British Government, in particular Prime Minister David Cameron, and Mayor of London Boris Johnson, for working so closely with us to make this Forum possible. I also wish to commend Tun Musa Hitam and the Foundation for choosing London, and for assembling such an impressive line-up. This is the largest gathering of leaders in the Forum’s history, and I look forward to the discussions to come over the next few days.
Ladies and gentlemen,
4. We meet at a time of both anxiety and hope. Hope, because the global economy shows signs of health once more, with progress in the US and here in the UK, reassuring data from China, and easing tensions in Europe. But also anxiety, because there is a feeling that although the symptoms may be abating, the underlying disease has not been cured.
5. Around the world, there is an ongoing discussion about the nature of the modern market economy; about how capitalism can serve people and nations, not just businesses and elites. The global financial system faces unprecedented disaffection. In the developed and developing world alike, policymakers are preoccupied not just with the quantity, but also with the quality of growth.
6. As we search for new and more sustainable growth models, there is one path that can increase productivity, improve corporate decision making, and strengthen economies. To take it, we must confront one of the most stubborn inequalities, one that is holding back prosperity and hindering development. It is time to put women at the heart of our global growth story.
Ladies and gentlemen,
7. All countries stand to benefit from the economic empowerment of women. For ageing societies, it represents a welcome boost to the workforce. For the poorest countries, positive impacts on education, health and development. And for the developed world, productivity gains and a rebalancing of growth.
8. Studies show that economies are healthier when women participate more fully. According to World Economic Forum research, greater equality and higher per capita income are closely related. In OECD countries, female labour participation is positively correlated with GDP. And research suggests a clear relationship between countries that are closing the gender gap, and those that are the most dynamic: six of the ten most competitive economies are also in the top 20 most equal.
9. Greater involvement of women can deliver better growth, more competitiveness, and greater human development. As the founder of the World Economic Forum said: ‘To develop the gender dimension is not just a question of equality; it is the entry card to succeed and prosper in an ever more competitive world’.
10. I believe policymakers, businesses and institutions should not focus on the merits of increased female participation, but on the best methods for achieving it: we should move from ‘why’ to ‘how’. Countries should be unafraid to learn from those who are leading the way – and that includes the Muslim world.
11. On education, employment, and corporate diversity, Islamic nations are already showing leadership: taking clear steps to give women a more central role in their nations’ economic future. It is my belief that this is neither contrary to our faith nor to our traditions; that instead, it honours the founding principles of Islam.
12. Islam has always provided for female employment, a position that is supported by Islamic law, tradition – and by the Quran itself. Verse 4:32 says that ‘For men is a share of what they have earned, and for women is a share of what they have earned’.
13. Furthermore, women’s economic empowerment traces its history back to the very beginning of our faith. Islamic women have fought battles, represented their people in parliament and their nations abroad. The first convert to Islam was a woman called Khadijah. Of all the merchants in Mecca, she was the most successful; an entrepreneur who managed an international trading empire. One day, she hired a young man by the name of Muhammad (PBUH), who she would eventually marry.
14. It should come as no surprise, then, that at the time of its establishment Islam provided for a degree of legal and financial independence which was almost without precedent. A thousand years before the Enlightenment, Muslim women were empowered to own assets, inherit property, and manage their own financial affairs. They were allowed to participate in politics, permitted to enter into legal contracts, and encouraged to pursue knowledge through study.
15. These principles have not changed; neither has the Quran, nor the example passed to us by the Prophet’s own life. Together, they provide us a with a compelling case for the economic empowerment of women.
Ladies and gentlemen,
16. If we wish to realise women’s true economic potential, there are three things we can do. First, we must focus on what the UN Secretary General calls ‘the smartest global investment’ of all – education.
17. Educating women is good for individuals, for families, and for nations. Educated women are less likely to die in childbirth, and more likely to send their children to school. They have healthier families; over the past forty years, investment in women’s education has prevented more than four million child deaths. And they are more productive in their own right: an increase in secondary school enrolment for girls is positively associated with participation in the labour force – and with greater household and national income.
18. According to the World Bank, for every 1% increase in the number of women with secondary education, a country’s annual per capita income grows by around 0.3 percentage points. Girls who benefit from just one year of education above the national average earn between 10 and 20 percent more.
19. Educating women is a critical factor in success: not just for women and their families, but for nations and their economies. And when it comes to educating women in core subjects such as science, technology, engineering and mathematics, the Muslim world is capable of leading the way.
20. Thirteen Muslim countries produce more science and engineering graduates than the United States. In Malaysia, almost two-thirds of students enrolled in tertiary education are women.
21. But there are also countries in which girls are falling behind, where their right to learn itself is being challenged – a right that is being defended so honourably by the inspirational Malala Yousafzai.
22. The Quran and the Hadith are clear: learning is an honourable pursuit, regardless of gender. The acquisition of knowledge is binding for all Muslims. Those who argue against educating women do so as a result of a cultural bias, one which frustrates the aspirations of Muslim women – and holds back economies.
23. We owe it to girls like Malala to deliver the best educational opportunities we can. That means prioritising early years education; investing in teachers; regulating and evaluating schooling, and focusing on skills to help young women bridge the gap between education and the workplace.
24. For education’s promise to be fulfilled, women must be empowered to pursue the opportunities it affords. And although the Muslim world is taking positive steps on education, we are falling behind when it comes to workforce participation.
25. There are bright spots; Tanzania tops the global tables for women’s participation in the workforce, and Indonesia is on par with the European Union. But overall, the position is clear: according to the World Bank, of the bottom 20 nations for female labour participation, 19 are majority Muslim countries. The latest Global Gender Gap report, released just last week, shows slow but steady progress for much of the world; but many Muslim nations remain static.
26. There are distinctive social and cultural reasons why economic participation rates differ. Not all women wish to join the formal economy, and labour participation is only one measure of development. But it seems unlikely that we are allowing all those women who do wish to participate to reach their full economic potential; and by leaving women out of our economies, we risk leaving ourselves on the wrong side of economic history.
27. Our second task, then, is to ensure that more women can translate their education into a successful and lasting career.
28. Evidence shows that policies to promote gender diversity matter; but the adoption of such policies is too slow. Globally, just 66% of companies had equal opportunity policies last year, up from 64% in 2008. At that rate, we will have to wait until 2081 for full compliance.
29. Governments should not hesitate to encourage economic participation more actively. But we need not always legislate: the Americas are amongst the best performing nations, despite having few legal quotas for gender diversity. Sometimes, it is about setting the tone; with governments and businesses working together to promote greater equality.
30. Structural changes can also help. OECD research suggests that expansion of the services sector – and the creation of more part-time jobs – can improve female participation. So too can tax changes and flexible working arrangements.
31. But the most important factor in building a female-friendly workforce is the provision of childcare. For many women, who are often primary carers, a lack of childcare services is the invisible wall that holds them back from participating in the economy.
32. In Malaysia, we require organisations to set up crèches, but workplace childcare is not always the answer. We should also look to other more innovative solutions, including community childcare; and encourage men to share responsibility when possible.
33. To ensure women play a meaningful role in the economy, we must also consider the type of work women do – and where they do it. According to the IMF, women are more likely to work unpaid, and more likely to have informal jobs. The rural-urban income divide is often exaggerated, with rural women working shorter-term and more precarious jobs. And of course in most countries a wage gap persists; women typically earn between 70 and 90% of what men do for equivalent work.
34. Malaysia faces many of these pressures. Our female labour force participation is currently 49.5%. We are aiming to improve it in order to see continued and sustainable growth.
35. So we have introduced policies to attract, increase and retain female employees. We have made a commitment to increase female labour participation rate to 55 per cent over the next three years. We are supporting skills programmes and entrepreneurship opportunities for low-income earners, and have introduced tax deductions for companies that train and employ women after career breaks.
36. We are focusing our efforts to foster a culture of entrepreneurship, which offers a path to economic participation for many women. And I am delighted to see that in the World Bank’s Ease of Doing Business 2013 report which was released yesterday, Malaysia has moved into 6th place – up from 23rd place just three years ago, soon after I took office.
37. We are also reinforcing Malaysia’s position as a global hub for Islamic finance – a fast-growing and resilient industry. In Malaysia, women fill top roles in Islamic banking – as chief executives, shariah scholars and analysts. With assets now exceeding US$1.2 trillion, and more socially responsible and financially secure prospects, Islamic finance offers, one that offers significant opportunities for Muslim women.
38. Finally, alongside education and workforce participation, we should redouble our efforts to shatter the glass ceiling.
39. Numerous studies have shown that increasing female participation at the highest levels has a clear and positive effect on the health of companies – and economies. Not only is the average share price of companies with women on the boards is greater – and returns on equity, sales and invested capital higher – but the performance gap widens during times of market uncertainty.
40. According to a Credit Suisse study, large corporations with women board members outperformed those without by 26% between 2006 and 2012. With smaller debts and a healthier attitude to risk, net income for companies with women on their boards grew by 14% over the same period – as opposed to 10% for those without.
41. Evidence suggests female involvement at the top of the corporate world can also help refocus incentives – away from potentially destructive short-term profit hunting, and towards more sustainable growth.
42. Companies with women on the boards are more likely to account for environmental risk when making investment decisions, more likely to invest in clean energy, and more likely to focus on energy efficiency. They demonstrate a stronger commitment to good governance, and to laying the foundations for long-term growth: working to improve access to healthcare, and offering services to those with limited access to financial products.
43. When it comes to representation in the boardroom, the evidence suggests that quotas can deliver results. In Malaysia, we have set an ambitious target: in two years’ time, 30% of senior decision makers and corporate boards must be female. That is three times the global average; more than double the figure in the United States, and not far behind global leaders such as Norway.
44. The decision making skills and risk awareness that prove so useful in the corporate world should be brought to bear in the public sector, too. When I took office four years ago, women occupied just 18% of the top posts in Malaysia’s civil service; today, thanks to targeted training and support policies, it is 33%.
45. Seven of Malaysia’s government departments are led by women. And the Governor of our Central Bank, Dr Zeti, is one of the world’s first female central bank governors. In fact, she has just been awarded ‘Grade A’ status by Global Finance magazine for the tenth time, and has played an important part in managing Malaysia’s continued growth. Dr Zeti is an example to young Muslim women around the world; her success shows that the glass ceiling can be broken, for the benefit of all.
Ladies and gentlemen,
46. Progress on these three areas – education, workforce participation, and corporate diversity – can unlock significant opportunities; not just for our citizens, but for our nations.
47. By educating our girls and women, by increasing their participation in the workforce, and by ensuring the highest opportunities remain open to all, we can strengthen our companies, our economies, and our prospects for the future. We can also honour the founding principles of our faith. Thank you very much.