The UN Conference on Trade and Development (UNCTAD) has released a report that examines how multinational enterprises (MNEs) can contribute to increased positive outcomes for gender policies and practices in the labor market. In particular, the report analyzes the mechanisms through which MNEs can influence host country workplace practices on gender.

The report titled, ‘Multinational Enterprises and the International Transmission of Gender Policies and Practices,’ examines the evidence of indirect spillover effects on local firms and labor markets, using data from case studies covering five countries across Africa, Asia, and Latin America. The main transmission mechanisms for MNE gender policies and practices to host economies are competition and demonstration effects, supply chain links with local firms, adoption of technologies that support female participation in the workforce, and labor mobility (former employees of foreign affiliates joining local firms).

The effectiveness and importance of these different transmission mechanisms varies by country- and industry-specific circumstances, including the cultural, business, regulatory, and economic environment in the MNE’s host country. For instance, in Bangladesh’s textile and garments industry, the presence of MNEs positively impacts gender practices of domestic firms: domestic firms that shared domestic suppliers with MNEs hired more female administrative workers, and downstream business partners of MNEs had 50% more female administrative workers than local firms. In South Africa, foreign affiliates hire more women at higher skills levels, and pay women a wage more than double the average in domestic firms. In Costa Rica’s information and communications technology (ICT) sector, labor mobility is high: nearly two-thirds of employees of local firms have worked for foreign affiliates, contributing to similar gender practices across the sector.

The report underscores the importance of examining the impact of various transmission mechanisms to target policy approaches in support of gender equality. Host country policies and programmes that focus on developing inclusive linkages and strengthening local absorptive capacities “are most important.” Governments in developing economies can also support MNEs through investment guarantee schemes or investment promotion organizations, and make this support conditional on reporting on gender practices. In addition, supplier capacity-building initiatives, awareness campaigns, and exchange programmes and training can effectively disseminate gender equality practices of MNEs.

The report finds that active enforcement and support for explicit non-discrimination policies is necessary to translate global policies across cultural and societal differences. For example, the report highlights the importance of: promoting maternity leave in ways that women do not fear repercussions; ensuring equal access to training; and ensuring equality in hiring practices, pay, and promotion opportunities across MNE networks.

The report concludes with a reflection on policy implications and enabling policies for gender equality. Among the 100 largest MNEs, “only 23 report on gender practices in their global networks.” The report identifies an opportunity to advance gender equality through increased use of international standards, such as by encouraging MNE reporting on gender at all levels of the hierarchy and by geography. The report further recommends encouraging positive gender policies and practices through the global policy environment for investment, such as by including gender equality objectives and gender reporting requirements in trade and investment agreements. Measurable reporting standards should include statistics on employment at different levels, gender and wage, participation in training, and availability of flexible working arrangements and childcare facilities. Additional policy recommendations include promoting linkage programmes between MNEs and local companies, showcasing the appointment of women in jobs where they are underrepresented or where women are in top positions, and facilitating partnerships, labor mobility programmes, and internships across foreign and local companies.

UNCTAD launched the report on 8 March to mark International Women’s Day. [Publication: Multinational Enterprises and the International Transmission of Gender Policies and Practices] [UNCTAD Press Release]