HANOI – In Vietnam, as in Asia in general, men are the dominant players in business. Women are generally expected to fulfil more servile roles and perform lower status jobs. However, there is a new class of female CEO in Vietnam who are showing that women can not only be the equal of men in business but, in fact, can outdo their male counterparts in financial performance.
Vietnam’s stock market is currently worth US$58 billion and is one of the highest performing markets in Asia. This success is, in part, due to the rising success of Vietnam’s new class of female CEOs.
A financial index that tracks the performance of Vietnamese companies run by female CEOs has tripled in value over the past five years. This is twice as much as the country’s benchmark VN Index increased in value over the same period. These numbers are particularly impressive considering the VN Index grew by 21 percent over the past year.
The Vietnam Women’s Index is spread across seven industries and has a median advance per year of 72 percent. The median gain of the VN Index is only 55 percent.
It is estimated that women own 25 percent of all private enterprises in the country. However, women control less than 7 percent of corporate board seats. While seemingly low, this is the second highest percentage in Southeast Asia – the Philippines has the highest. In comparison, the US has around 17 percent of company board seats occupied by females.
While the boys are away
Many people have explained the relative success of female CEOs in Vietnam by pointing to the Vietnam War. During the war, the majority of men were sent to the frontlines, this forced the remaining women to, in addition to looking after their children, take over the family businesses and finances. This is a situation not unlike what the United States saw occur during World War Two, especially, where women worked in factories and other normally male-dominated industries which thus set the grounds for the eventual women’s movement.
These early experiences with running a business gave Vietnamese women a strong grounding in practical business principles and empowered them in a way they had not experienced before, ultimately leading to the successful women leaders of today.
A woman’s touch
According to a report conducted by the Credit Suisse Research Institute, companies that have one or more female board members tend to produce above-average returns on equity and have higher stock market valuations.
As a general rule, having a more diverse group on the board of a company has been shown to vastly improve the financial performance of that company. Having a diverse range of viewpoints and ideas is the key to constant innovation and growth.
In particular, Vietnamese women are thought to bring a more inclusive decision making process and seek to find areas of common agreement rather than trying to force their viewpoints upon their colleagues.
Vingroup CEO, Le Thi Thu Thuy, has publicly stated that it was due to her experience as a mother that she was able to develop the idea of turning Vietnam’s largest mall into a destination location for families. Ms. Thuy added an ice-skating rink and indoor water park for the enjoyment of Hanoi’s residents. It turned out to be a very wise decision as the mall’s level of business has vastly multiplied. It was her focus on what is important to families, an arguably feminine trait, which led to her success in the field of business.
Vu Thi Thuan, CEO of Traphaco JSC until 2011, remembers that she would make a point of having lunch with her employees every day. This was an easy way to build up loyalty among her employees and prevent them from being poached by other companies. Her employees would refuse to switch to other companies even if they were offered higher salaries because of how much they appreciated the way they were treated by Ms. Thuan.
Still some way to go
While there are some great examples of successful businesswomen in Vietnam, it should be remembered that many of the country’s women struggle to start and run their own businesses. According to the International Finance Corporation, the main reasons for this struggle are that women suffer from a lack of business and financial management training, insufficient networking opportunities, and difficulty in balancing work and family responsibilities.
The country is changing in its treatment of women, and in the cities women can expect to be on a somewhat more equal footing with men. However, in the countryside women are still expected to be submissive to the men in their communities.
As Vietnam continues its economic rise, women must be included at all levels of business in order to ensure that the country is a beacon of dynamism and innovation in Asia and the world.