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Combining the feminine touch and the Midas touch
Arab women have traditionally shied away from the corporate spotlight, but thanks to better education and greater opportunities, they have found their niche today.
- By Jumana Al Tamimi, Associate Editor
- Published: 23:08 March 24, 2009
- Wealthy Gulf women face different challenges in making decisions when it comes to investing their fortunes, compared to men.
- Image Credit: Design: Ramachandra Babu, Dwynn Trazo/Gulf News
The first wife of Prophet Mohammad (PBUH), Khadija, is one of the most frequently-used examples whenever the issue of Islam's view about the right of women to own and manage their wealth is raised.
Before and after marriage, Khadija kept her career. She was a wealthy lady from a ruling tribe and was engaged in trade in the Arabian Peninsula. More than 1,400 years later, the number of super-rich women has grown noticeably in the region in line with its booming economies.
Bramdean, a London-based fund management firm, estimated that nearly 60 per cent of this wealth is held in cash. But this also makes it extremely difficult to have precise figures on the wealth held by Gulf women, partly because of its "invisibility", as financial experts put it.
"You might be probably aware that [women's] wealth is not recorded as men's wealth," Sandy Shaw, head of Middle East Operations at Coutts, a private-bank based in London, said. "It is a lot more [of a] secret."
Scores of women in the Gulf Arab male-dominated societies are holding wealth estimated at nearly $40 billion (Dh146.8 billion), according to some Western financial institutions.
Reports describe the finances of Gulf women as "growing pools" and "mountains" of wealth.
Accordingly to Shaw, men in the region own businesses, which makes their wealth more visible. This isn't the case when it comes to women, particularly in some countries where women have been allowed to independently manage their wealth only recently. An example is Saudi Arabia where women were legally required to conduct business through a male agent until 2004.
On the other hand, women are sometimes reluctant to reveal the extent of their wealth.
"In general, a [GCC] woman wouldn't like to disclose the amount being deposited in her bank accounts," Saeeda Al Shamsi, Sales and Services Senior Officer at Johara - a ladies banking services introduced by Dubai Islamic Bank, said. "She considers it a personal issue that she doesn't have to share with others."
Responding to a question on why women prefer to keep their fortunes hidden, Al Shamsi countered, "give me one convincing reason why a person should reveal the amount of money in her or his bank account?"
Many wealthy Gulf women are also depositing money in foreign banks and investing their funds abroad citing "privacy" issues, financial experts say.
Johara, the Arabic word for gem, is one of the new banking services, including special female staff, providing women with 'privacy' concerning their wealth in the Gulf region. Other banking services for women in the UAE include Al Reem by the Emirates Islamic Bank, and Forsa by Dubai World.
Masrafy, the first Islamic investment bank for women in Bahrain, was launched in June 2006. The bank's authorised capital is $1 billion and a paid up capital of $500 million. Masrafy's main shareholders are Abu-Dhabi Investment House (ADIH) and a number of financial institutions, including Qatar Islamic Bank.
However, the pioneering financial institution for women was created in Doha, Qatar.
In 1998, Shaikha Hanadi Nasser Al Thani launched Qatar Ladies Investment Company, which was renamed as Amwal a few years back. It provides a wide range of services including fund, wealth and portfolio management.
Apart from opening financial institutions serving only women, some Western women bankers travel to the region to meet their female clients, many of whom prefer to stay behind the scene. But there are others, who run their businesses perched on expensive-mahogany desks and soft leather chairs.
"I have seen a number of women in Saudi Arabia [working] behind the scenes and quietly pulling the strings in various businesses," Shaw said, "very quietly and very subtly."
Some estimates say nearly half of the Gulf women's wealth is in oil-giant Saudi Arabia.
"But I think we see more and more women coming back from universities and wanting to use their skills. More and more women want to get involved in businesses," Shaw added.
She was speaking during her recent visit to Dubai to attend an event on Arab Gulf women.
Last year, Forbes magazine listed Maha Al Ganem, chairman and managing director of Global Investment House in Kuwait, among the top 100 powerful women in the world.
In 2005, Lubna Olayan from Saudi Arabia, the CEO of the Olayan Financing Company, made the list.
Contrary to many unfounded perceptions outside the Arab region, Islamic laws guarantee women's rights to have their own money. Islam doesn't prohibit females from managing their wealth or their families. Yet, some norms and traditions in relatively conservative Arab societies, including Arab Gulf countries, discourage women from doing so.
For many rich women, direct meetings with men in the business field are not preferable.
Things are slowly changing though.
With the increasing number of female university graduates and growing acceptance to their presence in many areas of the labour market, more and more women are earning and saving money.
Inheritance is, however, a main source of women's wealth in the Gulf Arab region.
With changing circumstances, women, financial experts believe, have a strong wish to have a greater say in managing their fortunes.
Some experts believe that apart from the higher level of education, rising divorce cases in the region is also making the rich women want to "keep some of their money" for themselves to secure the future of their children.
"We do have women investing in businesses, and we do have women running businesses," Shaw, who has been in the field of investment consultancy for the past 30 years, said.
"I think, traditionally, women have not had... as much experience in managing money as men, but this is changing because obviously nowadays women have excellent access to a very [high] standard of education in the GCC, and therefore, now we see a lot more women managing their own money," she added.
At the same time, "a lot of women don't want to be in the spotlight," Shaw noted.
Meanwhile, wealthy Gulf women face different challenges in making decisions when it comes to investing their fortunes, compared to men. Women like to be on the safe side when it comes to their money, Al Shamsi said.
"Women, probably, from what I have seen, are risk averse," Shaw noted. "Men tend to take greater risks than women," Shaw added.
"They [women] like investing in property. This is something they know and understand. They feel very comfortable investing in property," Shaw replied when asked about women's favourite investment areas.
"Property is like a faithful child," Al Shamsi said of what many of her customers keep saying in reference to the importance of property in wealth, unlike cash, which might evaporate with a strong blow of a financial crisis.
Also, "a lot more women are creating structures to leave money for their children, structures such as trusts, so they can be sure that their money will pass down to their children [after death] & They can be very specific about how that happens. We see a lot of that," the British consultant added.
However, because they are new in the world of money and big investments as customers and decision-makers, they face the huge challenge of proving themselves and their abilities, like in any other profession or career, which used to be limited to men. "This is not just in the GCC," Shaw said. "Globally, it is harder for a woman to make their way up," she added.
Despite both men and women receiving the same standards of education today, "there are some barriers if a woman wants to enter a certain business. In the West, those barriers are being broken down and we see a lot of women in banking, in accountancy, and in legal firms. We are now beginning to see that in the GCC, but not as widely as in the West yet," she explained.
But the fact that women own tens of billion of dollars either in cash or safe investments, being part of family-run businesses, Gulf women gain more importance in their national economies.
Family-run businesses constitute a valuable component of the region's economy. A number of large companies in the region started as a family-owned business before being listed on the stock markets.
A recent survey concluded that 24 families in the UAE control 37 per cent of the seats on the boards of directors of companies listed on the stock markets in the region.
Accordingly, the wealth held by women, as Shaw describes it "is quite important" in the overall investment potential of the region.
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