State Department Is Partnering With Goldman Sachs To Fight Women's Economic Inequality

03/09/2015 10:01 am ET | Updated Mar 09, 2015

WASHINGTON -- Secretary of State John Kerry will announce his department's latest effort to combat global gender inequality at a Monday luncheon at the Foggy Bottom headquarters. Partnering with investment banking behemoth Goldman Sachs, the State Department is running a two-week training program for 29 women from 15 Middle Eastern countries, aimed at teaching participants entrepreneurial skills.

Goldman Sachs, best-known as the leader of Wall Street, is not the most obvious pick for a State Department public-private partnership. But since the financial crisis, Goldman Sachs has ramped up its charitable portfolio, with a targeted focus on female economic empowerment.

In 2008, the company launched 10,000 Women, a program aimed at helping women in developing countries create or grow their own businesses. Though it hit its goal of helping 10,000 women in 2013, the company says it has no plans of winding down the effort.

At the head of that push is Dina Powell, president of the Goldman Sachs Foundation. Born in Egypt, Powell and her family moved to Texas when she was 5 years old. She spoke no English. Her father, who had been an army captain in Egypt, opened a convenience store to support his family. Though her parents urged her to become a doctor, lawyer or an engineer, Powell opted for politics, spending most of her career in the White House and State Department before joining Goldman Sachs in 2007. She described the process of launching 10,000 Women as "very organic."

"It was a report called Womenomics that led to 10,000 Women. Our chief economist, Kathy Matsui, in Japan, wrote this piece that looked at the impact that greater labor force participation by women in Japan would have on the Japanese GDP growth. And that of course, given the size of the Japanese economy, that would have enormous positive implications on global GDP growth," said Powell.

A subsequent Goldman Sachs report, called Women Hold Up Half the Sky applied a similar thesis to emerging countries and found that the impact could be equal to or greater than that of developed economies.

Powell's successors at the State Department were impressed by Goldman Sachs' effort. "We saw that they were working hard to lift entrepreneurship, both abroad with 10,000 Women and at home with a similar program called 10,000 Small Businesses," said Assistant Secretary of State for Educational and Cultural Affairs Evan Ryan, who began working on the project shortly after she took office in late 2013. "That's a big priority for Secretary Kerry as well, so we did think that they would be a good partner."

Ryan's bureau, which operates exchange programs with participants from all over the world, spearheaded the effort to incorporate some of the best practices from the Goldman Sachs program into a two-week, educational program in the U.S. The participants arrived in New York City on March 1, where they networked with Goldman Sachs employees. They are currently in Washington, D.C., meeting with policymakers and local business incubators. The trip concludes with a four-day training at the Harvard Kennedy School of Government in Cambridge, Massachusetts.

The women, visiting from Algeria, Bahrain, Egypt, Iraq, Jordan, Kuwait, Lebanon, Libya, Morocco, Oman, the Palestinian Territories, Qatar, Saudi Arabia, Tunisia and the United Arab Emirates, were first selected as candidates by U.S. embassy personnel. (Ryan noted that embassy staff could not find a suitable candidate from Israel and their Yemeni pick was ultimately unable to get a visa to the U.S.). A panel of State Department and Goldman Sachs representatives chose the final candidates. "We were really looking for women who have demonstrated entrepreneurial spirit ... that 'startup' personality," explained Ryan, who served on the panel.

Chantal Jaoude, 28, is the founder and general manager of an automotive business in Lebanon. Though the industry is typically male-dominated, she has grown her business to an annual turnover of $1 million and is now looking to expand internationally. Feda AlTaher, is a 32-year-old Jordanian who founded Zaytouneh, a cooking website with over 1,300 instructional videos that have been viewed over 40 million times. In Kurdistan, 38-year-old Talan Aouny founded a recruitment agency, and she now works with the U.S. Agency for International Development to hold job fairs throughout the region.

In countries without operational U.S. embassies, such as Libya and Syria, neighboring embassies were able to identify candidates and bring them to the U.S. for training. Despite tense diplomatic relations between the U.S. and several countries in the region, Ryan said, the State Department faced no opposition from host governments in allowing their women to participate.

"It was quite the opposite really," she remarked. "Entrepreneurship is such a uniquely American characteristic ... other countries really want to capture that."

The training ends Friday and the 29 female entrepreneurs will return home. While there is currently no plan for a repeat program, both the State Department and Goldman Sachs indicated interest in continuing the partnership if funding were available. The total cost of this training was $500,000, split evenly between the two organizations.

While skeptics have criticized Goldman Sachs' charitable outreach as an effort to rehabilitate their corporate image after the financial crisis of 2008, Powell points out that 10,000 Women was launched in 2007, before the economic crash.

"I would say that when you look at programs like this, the most important thing to judge is the result," said Powell. "We not only committed to reaching 10,000 actual women around the world with business and management education, links to capital and business advising from Goldman, we measured the results transparently with independent parties and released those results. The results and the beneficiaries speak for themselves."

A progress report conducted by Babson College found that nearly 70 percent of surveyed graduates of 10,000 Women increased their revenue, 60 percent added new jobs to the labor market, and 90 percent "pay it forward" by teaching business skills to other female entrepreneurs.

"We've really been committed at Goldman Sachs for 145 years to thinking about ways we can make a positive impact through these kinds of impact-investing programs," concluded Powell.

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