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Christine Lagarde and her ground breaking study on women

Managing Director of the International Monetary Fund, Christine Lagarde is one of the world’s most powerful women and a role model to many, including Women of Influence President and CEO, Carolyn Lawrence.


In the aftermath of the global financial crisis, the world economy remains in a time of reinvention. Today, countries the world over face new challenges of stability, job creation, and sustainable economic growth. Among the many risks ahead, we must include an aging population, the need for reform of economic governance, and the development of an international banking system that can stand the test of time.

In April 2014, the International Monetary Fund (IMF) reported in its World Economic Outlook that, “global activity has broadly strengthened and is expected to improve further in 2014–15, with much of the impetus coming from advanced economies. Inflation in these economies, however, has undershot projections, reflecting still-large output gaps and recent commodity price declines. Activity in many emerging market economies has disappointed in a less favorable external financial environment.”

The IMF forecasts global growth to average 3.6 percent in 2014, up from 3 percent in 2013, but emphasizes that “growth remains subpar and uneven across the globe.”

Formed in 1944 for the purpose of lending money to troubled countries, the IMF’s current mandate, as described by its current Managing Director, Madame Christine Lagarde, includes “surveillance—we go under the skin of the economy of our members, to see whether the numbers are right, and how the economies are doing; we lend money to countries in difficulty…starting in Ukraine after the Second World War, to Latin America, to Asia, back to Ukraine, to all of central and eastern Europe at the time…And we do technical assistance and capacity building.”

In order to share its findings, aid and recommendations for improvement, one of the primary roles of the IMF is to address the members of the G20. The most recent annual meeting called for a focus on “strengthening growth and creating jobs” as its top priority. The agenda specifically called for needing “new approaches to ensure growth is sustained in the years ahead.”

All eyes should now be turned to the organization’s leader.


In addition to being the first woman Director of the IMF, Lagarde has held many other “firsts” for women: she was the first female French Finance Minister (of a G8 country), and the first female head of an international law firm, Baker and McKenzie. Her experience includes years in Washington. At the IMF, she sits on a board of 24 members, and there is only one other woman on the board, the U.S. representative. Lagarde, while holding profile and influence on the world stage, is not a regular in mainstream media. So, when she was announced as a speaker at the 2014 Women in the World Summit (WITW) in New York City, I jumped at the chance to hear what she had to say.

Lagarde has been covered in the media—as it goes with senior executive women—on everything from her policies to her purses from publications ranging from Vogue, Time and Fortune, to audiences including the G20, and students at George Washington University. I got my first introduction at WITW this April when she and Hillary Clinton were interviewed by Thomas Friedman, renowned journalist and author of The World is Flat, in front of an awe-inspired, and like-wise awe-inspiring, audience in New York’s Lincoln Centre.

Lagarde is influential, confident, powerful, notably elegant, feminine and has a sophisticated style that I find not only attractive, but effective. At WITW, she sits forward in her chair, or “leans in” just as interested in sharing her views as we are in hearing them.

What stands out to me, as I watch her on the stage, is the powerful combination of intellect, warmth, and wit, paired with a unique approach—certainly in contrast to her fellow panelist—in answering a direct question. As Time put it, “she doesn’t speak in the opaque language of the IMF’s economic-policy wonks and insists this is an advantage.”

Whatever her approach, it is working. The audience of mostly New York women, and young global leaders and activists tired and buzzy from long flights from the Middle East, Africa, and Oklahoma, all want to know: how else can we change the world for women? How else can we do better? How else can you lead us as women?

Tina Brown kicked off her 5th annual WITW on the evening of April 3rd, and by 7:30pm we were riveted.

During the key panel discussion Clinton stole the stage, appearing to answer two questions for every one from Lagarde. I found myself on the edge of my seat the moment Lagarde spoke in her direct yet light hearted manner, in contrast to Clinton’s politically fueled indirectness. Clinton was of course wildly impressive and inspiring, and you could read between the lines to interpret her message, but I was more impressed with Lagarde’s clear and candid approach, and I think the rest of the audience was too—which was apparent by the ready laughter at her jokes. Like when she described her role as head of the IMF to being a firefighter, “You cannot be a firefighter and have a little tap that opens over time. You need to have the big hose, right? Well, that’s what we need. So I’m a firefighter, and I’ve got this tap, which works, you know, it’s a pipe, but it’s not as big a hose as I need,” she says.

“Christine Lagarde combines the best of European diplomacy with American work ethic and common sense,” shared Diane Francis, Editor at Large of the National Post, who first interviewed Lagarde as Finance Minister of France and observed her for years at the World Economic Forum in Davos. She summarizes, “Lagarde is a leadership superstar!”

Which is exactly why we found her so compelling.

Lagarde has turned into the great crusader for women’s advancement. What’s fascinating to me, and what I think should be widely explored and discussed, is this fact: Lagarde set out to find a way to improve growth in the world’s economy, she ran the numbers, and measured the potential income and outputs of every country’s potential to develop; and the answer she and the IMF have come to is women. Women are the answer to the global economy. More specifically increasing the Female Labour Participation Rate in order to improve the Gross Domestic Product (GDP) of a country.

As Christine Lagarde said in an interview published by NPR (formerly National Public Radio) in March 2014, “giving women access to the job market isn’t just about equal opportunity—it makes economic sense.”


The big news story for me is not that she’s on the stage, sharing it with Clinton, or surrounded by the likes of whom Tina Brown can attract—from Queen Rania to Diane von Furstenberg, Katie Couric to Arianna Huffington, it’s the report that she is holding in her hand at the beginning of her speech. The report is from the IMF on how to increase the GDP of countries globally. How, does she suggest this? By increasing the number of women contributing to the workforce.

This is interesting. Titled “Women, Work and the Economy,” the report is suggesting that, on a global scale, women are the answer—not because it’s right, but because it makes economic sense. What’s even more interesting is that these findings are not in the main- stream news cycle; they should be. Does anyone else hear how revolutionary this is? And see the long road ahead for Lagarde?

Canadian broadcaster and former politician Isabel Bassett wonders if perhaps Lagarde is “a voice in the wilderness.” Bassett goes on to explain—knowing from experience, “as a clever, politically savvy, and globally minded leader, she hasn’t stopped pointing out the economic benefits for countries, and companies that hire and promote more women. But it’s a hard sell.”

There have been countless studies in the past 12 months on the gender gap published by the media, consulting firms and corporations angling to find the report that makes the news cycle and that shows their support of the cause. And yet “Women, Work and the Economy,” which has the most potential for impact due to its extremely detailed policy recommendations for all 188 countries in the world, has had limited play. At WITW Lagarde handed Friedman the report, on the stage, as if to say, she assumed he hadn’t read it!

Published in September 2013, the report is the IMF’s first study on women in the labour force. The full title, “Women, Work and the Economy: Macroeconomic Gains from GenderEquity,” summarizes that “women make up a little over half the world’s population, but their contribution to measured economic activity, growth and well-being is far below its potential, with serious macroeconomic consequences.”

The report’s power and potential to influence is in the details. Among its 32 pages, it explains in statistical detail how removing the barriers to women’s participation in the workforce through reform of policies, and reinvention of leadership, will be the answer to our most pressing global issues of stability, job creation, and sustain- able economic growth.

The theory is based on the facts that, “while women constitute half the working- age population, they represent less than one-third of the actual labour force. And progress toward gender equality seems to have stalled. Despite overwhelming evidence that gender inclusion makes economic, business and social sense, the gender gap is not being closed fast enough. Women still face glass ceilings, glass walls, and even glass cliffs. The challenges of growth, job creation and inclusion are closely interlinked. Growth and stability are necessary to give women the opportunities they need. And women’s participation in the labour market is also a part of the growth and stability equation.”

This report is unique in three ways: First, it suggests tax reform to break down the barriers; it calls for a reinvention of how we govern, grow and prevent future shocks to the system (like the global financial crisis)— from child support, child care, education and the pension system; and lastly it isn’t the talk of the town.

The report states: “in rapidly aging economies, higher female labour force participation can boost growth by mitigating the impact of a shrinking workforce. Better opportunities for women can also contribute to broader economic development in developing economies.” It also explains that, “implementing policies that remove labour market distortions and create a level playing field for all will give women the opportunity to develop their potential and to participate in economic life more visibly.”

“Inclusion should be given as much importance as growth.”

But not just because of the plight of women and their rights, but because of the economic benefit. In an answer to the global economic need to recover, evolve and grow, Lagarde has, in her role as head of the IMF, chosen to recommend substantial growth through reform of policies affecting the ability of women to contribute—by removing the barriers for them to do so. The result of this work, the IMF reports, would enable countries like the U.S., Japan and India to increase their GDP by 5 to 27 percent.

What I know about increasing women’s participation in the workforce is that it is not accomplished by the simple change of a policy, but often begs far more widespread evolution. Increasing the GDP of countries on a global scale by opening up jobs and removing barriers to entry for women is a tall order.

“If you bring more women to the job market, you create value, it makes economic sense, and growth is improved. There are countries where it’s almost a no-brainer: Korea, Japan, soon to be China, certainly Germany and Italy. Why? Because they have an aging population. And in countries like Japan or Korea, immigration is complicated,” Lagarde told a rapt audience at WITW.

Two examples of the policies that Lagarde is recommending are already showing signs of implementation. She proudly shares that “in both [ Japan and Korea] the policymakers have decided to put women at the centre of their budget, at the center of their policies going forward. For instance, Prime Minister Shinzo Abe has identified a big-budget item that will go to build child care centers in Japan, which is obviously one of the ways to lower the burden on women and facilitate their access to the job market.”

But not unlike the case for gender diversity and inclusion at the senior level of corporations, this news is not making head- lines. In fact, we know that companies that have a gender diverse senior team report, on average, 34 percent higher profit margins. In today’s economy you’d think CEOs would kill to drive their numbers that way, and beat the competition before it becomes the norm. But they’re not. Why? It’s because change is hard work, and it’s uncomfortable. It requires a leap of faith, a big commitment, and risk that few have the tolerance for. So companies dip their toe into the water without confidence they have the right tools to reform. And so they don’t evolve. Lagarde’s findings should give all of us confidence to take the plunge.


This is the part of Lagarde’s message when it all become clear—the power and potential of her recommendations for our reinvention.

“In many countries, tax is assessed on a family unit. And guess what? The marginal rate of taxation applies much more heavily on the secondary wage. And guess what? Because women are generally paid less than men for the same job, they are the secondary wage, right? So they’re taxed much more heavily because of the taxation system in place. If you change that, and instead of having a family unit, you have taxation on the individual, then that discrimination, that disincentive, goes away,” she explained at WITW.


For example: In Canada, the decrease in the secondary earner’s tax wedge contributed significantly to the increase in Canadian women’s labour force participation rate between 1995 and 2001. The IMF’s report also includes recommendations, specifically in countries with a large gap in the retirement ages of women and men, for reform of child support and the pension system, as well as social benefits that could increase the incentives for women’s participation in the labour force.


In the European Union in particular, Lagarde has pressed for major reform, with strict new banking policies and capital controls in Cyprus to “provide the basis for restoring trust in the banking system.” In the wake of some of her reforms, specifically to the problems in Cyprus, she has faced tremendous criticism; spending a lot of her “political capital” as Time magazine put it. But this is the cost of righting wrongs, and part of the tough job she has ahead.

Lagarde has said on many occasions that “inclusion should be given as much importance as growth,” but now she tells us how. This we cannot ignore.


Like many of us around the world, Lagarde seems to be facing the question of how to make change, have a positive impact and be valued for your contribu- tion. And when one is brave enough to dream big, be disruptive and ensure follow up, one needs to set targets, which she encourages, and she supports the role of quotas, but only in the short term.

So how will she lead this change?

By making her own way, as she said she would, at a key-note address at the 2012 commencement of the Harvard Kennedy School. She is following her life-long motto, “I shall find my way or make one.” The significance of Lagarde at WITW, and in sharing the stage with Clinton, communicates that she is at the peak of relevance; perhaps she will become the next president of France, she has her finger on the pulse of Ukraine’s crisis, and is among a handful of other female global leaders.

Lagarde, as a woman, mother of two, twice married, and owner of at least four Hermès Birkin bags, and Chanel accoutrements, makes it easy to aspire to her style and the seemingly effortless elegance of a beautiful, tall and lean French woman, but there is much more about Lagarde to which we can aspire.

Lagarde believes that the “transitions must ensure that all countries can prosper in an increasingly globalized and interconnected world, which the IMF believes it can help achieve.” She also has said, in an interview at George Washington University, “that is how I see the IMF—not leading, not following, but helping.”

On being asked at WITW by Friedman about what the future holds, she talks of wanting to leave the IMF as a place “where women have a place and a voice throughout the whole organization, providing real down to-earth practical value…I perceive my role as making a difference when I can encourage other women. If I’m a single voice always in a room full of men, it’s only going to carry the organization so far.”

In response to any potential criticism, or nay-sayers who might claim there aren’t enough women with the qualifications for management, Lagarde has said to NPR, “If a man said that to me, I think he might get in trouble, yes. There are now more and more young, talented female economists. So if any head of a department tells me, ‘no, I’m terribly sorry, I can’t hire a woman because I can’t find any talented or competent women,’ I would say ‘rubbish.’ In the 2013 Economists Program [an IMF recruitment program], we hire 51 percent women, 49 percent men.

Lagarde is a woman who wants and craves change, sharing the touching impact of her recent visit to Myanmar. When “Lady Aung San Suu Kyi said to me, ‘I want to thank the IMF for what you’ve done for my country, and how you’ve helped us improve the economic situation and go one more step in the direction of democracy,’ I cried. If we can do many of those things around the world, I will have done something good.”

Isn’t that what we all want?