Women in procurement: Why the controversy?
Written by Stephanie Jeremie
Preferential access to public procurement markets is increasingly being voiced as a feasible policy option for empowering women and women-owned businesses. Unfortunately, throughout my different work experiences in procurement, I have noticed the absence of women-owned businesses in tendering processes.
The reasons for this absence have been insufficiently developed and are not always fully understood. For some, there is a “concern of vested interests, both domestically and internationally”. For others, it would be unethical to reserve a quota for women-owned businesses due to the underlying principles of public procurement, i.e. fair, competitive and transparent contracting processes without bias towards any group of persons.
This piece is not to discredit or undermine the ways in which public procurement operates within different governments or organizations, ours included. Instead, I hope to present my observation to challenge the different mechanisms in place that may disadvantage women’s full participation in procurement.
First, I would like to challenge the assumption that women have equal access and opportunities to participation whether to specific tenders or within the broader economy. Some studies suggest this to not be the case. In the United States for example, “privately held women-owned firms, represent only 28% of all businesses”. In emerging markets, the figure is a little higher with the share of formal SMEs, fully or partially owned by women, ranging from 31% to 38% (or 8 to 10 million). It is clear that women are still underrepresented when accessing the market. When it comes to accessing public procurement, women-led businesses are disadvantaged and struggle to achieve the same benefits of government contracts as compared to their male counterparts. Multiple reasons can explain this. For example, women tend to run smaller scale companies in the informal sector and lack access to formal procurement training. In addition, the business registration process in many countries are too complex to navigate and many women therefore fail register their companies. This why so many women are overrepresented in the informal sector and run unregistered micro-level enterprises.
An option to counter the fact that women’s businesses are too small for large public procurement tenders could be to encourage joint ventures or other collaborative and collective efforts among the women entrepreneurs so that their operate as a medium or large size business. Another option is to have an accessible list of goods and services offered by these companies that other procurement entities could easily pick from. Maybe the Empower Women Business Hub could offer this?
This brings me to my second observation. Another setback to the participation of women owned businesses in procurement is the lack of women’s property and inheritance rights as well as other asset ownership. For example in Kenya, owning land is vital to producing and selling agricultural goods. Although the constitution purports equal land rights between women and men, women remain marginalized in relation to land control and exploitation.
Similarly in India, women’s ownership of financial and physical assets remains limited. There is a low percentage of women whom actually own enterprises. For the most part, they work in unpaid family-owned enterprises where they have no rights to business ownership.
The question then is whether we are truly being fair by not pursuing equal access and opportunity for women through positive discrimination, or quotas, in procurement. The Beijing Declaration and Platform for Action contain clear references to positive action as a tool for achieving de facto equality. The UN Secretary-General is making use of these measures in the recruitment, promotion and placement of women to promote gender parity within the UN.
Some countries, such as Kenya and the US have taken steps to institute specific quotas for women to improve their access to public procurement. In the USA, one of the federal contracting goals aims to promote greater access for women owned small businesses to procurement offers. Similarly, in Kenya 30% of public procurement is reserved for women, disabled persons and youth.
In conclusion, I believe it is important for us to remember that our mandate is attached to an ideology challenging us to create opportunities for young women and girls across the globe any way we can. By not instating gender-based procurement, we are not only doing a disservice to these women, we are also not being true to the ideas we seek to represent in this world.