Leadership and Gender in Microfinance Institutions: Perspectives from Bangladesh

Abstract: 
In the first decade of the twenty-first century, women have taken leadership roles in virtually all sectors of government, business, the not-for-profit community and social movements in many economically developing and developed countries. In spite of this, there is a notable absence of women in top leadership positions because of a hidden bias against women. The paper explores the relationship between gender and leadership and also examines the impact of gender on leadership. Drawing on an empirical case study, this article examines how gender and leadership interact in a leading microfinance institution in Bangladesh. Although there are some concerns regarding women’s ability to lead, based on our research findings the article concludes that women can make meaningful contributions to such organizations as leaders. The paper also suggests that in modern globalised world various opportunities will be increased for those women (and men) who display more of the ‘feminine’ characteristics that the transformational leadership implies.
Main Article: 

Introduction

Leadership has been a topic of great interest for academics and researchers who have promoted a range of theories, from contending that leaders are born with innate abilities to lead to a ‘new’ theory of leadership, sometimes called transformational leadership. What has often been missing in the research is the role of gender in leadership theories. Indeed, until relatively recently the concept of anything other than a particular masculine style of leadership typically adopted by men, was not considered at all.

What is the impact of gender on leadership? Most studies of leadership have focused on what it takes to lead and manage resources rather than on the person doing the leading. The rhetoric around such practices has tended to be masculine and gender has rarely been considered as an element in studies carried out on leadership (Metcalfe and Altman, cited in Wilson, 2001). That is why the aim of this study is to explore how gender is perceived in the leadership roles in various development organizations and also their contribution to socioeconomic and human development through the organization. In section one, we discuss some of the influential leadership approaches, such as the trait approach, behaviour approach, Fiedler’s contingency model, the path-goal theory of the contingency approach and transformational leadership theories. Section two outlines the methods and approaches used in collecting data and information for this study and also describes specific research context, i.e. Grameen Bank (GB) in Bangladesh.  Section three presents the findings, i.e. leadership practices and gender influence from Grameen Bank and critically analyses the results of the research. Section four includes a further discussion of the findings from Grameen Bank, which has been making efforts to focus on the issue of gender both organizationally and in its development work. Finally, the paper concludes with some recommendations.

Leadership, Gender and Microfinance Institution: A Theoretical Overview

There are many different definitions of leadership and many interpretations of its meaning. According to Bryman (1992:2), “leadership is typically defined in terms of a process of social influence whereby a leader steers members of a group towards a goal”. In the same way, Rost (1993:102) defines leadership as “an influence relationship among leaders and followers who intend real changes that reflect their mutual purposes”.  Leadership may also be viewed ‘in terms of the role of the leaders and their ability to achieve effective performance from others’ (Mullins, 2005:281). Whitehead and Whitehead (1986:74-75) in turn view leadership as ‘transformational’.

At the same time, in organizational analysis gender is often ignored. The theory is often ‘gender blind’ and ignores it as a key variable in organizations, as a process and as an effect on power relations (Wilson, 2001). Wilson (2001:1) notes that “Gender has often been perceived as synonymous with biological sex”, suggesting that the issue of gender has, until relatively recently, largely been seen as straightforward and unproblematic. Hence, there was little research to support this view of ‘biological essentialism’ which tended to make generalizations about women as a homogenous group. A contrasting view defines gender as a classification that is learned through a process of socialization. This socialization takes place from the moment we are born, reinforced by what we learn from interacting with parents, the media and teachers, to adulthood (Wilson, 1995).

Descriptions of gender attributes are clustered around two sets of behaviours: those that are described as feminine and those that are considered masculine. Feminine behaviour includes interdependence, cooperation, receptivity while masculine behaviour includes self-sufficiency, independence, control and rationality (Marshall, 1993 in Due Billing and Alvesson, 2000:146-147). These gender descriptions also tend to be viewed as complete opposites, implying that one behaves according to one set or the other, depending on whether one is born female or male.

Reskin and Padvic (1994, cited in Aaltio and Mills, 2002:74) consider that the construction of gender has been used by societies “to exaggerate the differences between males and females…to maintain sex inequality. There are also limitations in offering universal descriptions of feminine and masculine attributes when, cross-culturally, different constructs prevail”. In other words, what is acceptable for a women in one country is not necessarily so in another. Due Billing and Alvesson (in Aaltio and Mills, 2002) therefore suggest that masculine and feminine should be used to describe cultural and symbolic meaning rather than universal gender types. They suggest “gender is usually understood as a number of dynamic, ambiguous and varying phenomena rather than abstract, static and unequivocal” ones.

The trait approach to leadership suggests that traits, such as intelligence, values, self-confidence and appearance, are the distinguishing personal characteristics of a leader (Daft, 1999). It assumes that leaders are born, not made and research here focuses upon identifying the personal characteristics which distinguish leaders from non-leaders (Drummond, 2000:75). However, trait theory is gender-biased and specifies the above characteristics as male traits. Research focused on the characteristics that were displayed by leaders in military and law enforcement establishments, positions held invariably by men at that time. Although the theory was appealing there have been a number of criticisms of it, including the failure of the research to examine the impact of different situations on the traits observed and the relationship between the ‘leadership traits’ and performance outcome. The traits that were highlighted from this male-dominated research were obviously associated with men and the masculine construct of gender (“individualism, assertiveness and courage”) (Ely, in Ely et al, 2003:156) and even went so far as to describe the physical characteristics of leaders, e.g. ‘tall’ which further excluded the concept of women leaders. However, as Ely et al (ibid) point out, empirical evidence since the early research has not shown that women are any less likely to demonstrate such leadership traits; it is because women are not expected to demonstrate these traits that they have had difficulty in living up to the images of leadership that trait theory has promoted. For example, women who have displayed these traits (such as Margaret Thatcher) are considered successful because they are ‘masculine’ and lead as men, but they are unpopular because of this (Costrich et al, 1975 in Wilson, 1995). This tends to reinforce the view that it is men who are more naturally leaders.

While the trait approach emphasizes the personality characteristics of the leader or what the person is, the style/behaviour approach emphasizes the behaviour of the leader. It focuses exclusively on what leaders do and how they act (Northouse, 1997:32). Wilson (1995:155) states that, “Leadership is not about possessing a combination of traits; it is about developing a working relationship among members of a group in which the leader acquires status through active participation and demonstration of capacity for carrying cooperative tasks through to completion”.

Hence, this theory is less tied to gender. Two popular studies, the Ohio State and the University of Michigan studies, underpinned the investigation of management style. The work of the Survey Research Centre in Michigan in the 1940s and early 1950s identified two dimensions of leadership behaviour: employee-centred behaviour and job-centred behaviour. This work ran concurrently with the influential studies of Fleishman and Stogdill at the Bureau of Business Research at Ohio State University (Fleishman, 1953a; 1953b; Fleishman and Harris, 1962; Stogdill, 1948; 1950; Stogdill and Coons, 1951, cited in Huczynski and Buchanan, 2001:716). Foremen in the International Harvester Company and employees in other organizations were asked to rate the frequency with which their superiors behaved in the ways described in a leadership behaviour description questionnaire (Huczynski and Buchanan, 2001:716). Consistent with the Michigan studies, the Ohio results indicate two major dimensions of leadership behaviour, labelled ‘consideration' and ‘initiating structure’ (Mullins, 2005:289). Consideration describes the extent to which a leader is sensitive to subordinates, respects their ideas and feelings, and seeks input from subordinates regarding important decisions. On the other hand, initiating structure describes the extent to which a leader is task oriented and directs subordinates’ work toward goal achievement and rule with an iron hand (Daft, 1999: 72).

The central focus of the contingency approach is the situation where leadership is applied. According to Fiedler and Chemers (1974 in Northouse, 1997:74), the theory is a ‘leader-match’ theory, which means it tries to match leaders to appropriate situations. The research implies that three situational variables such as task structure, leader member relations and power position are important to leadership style. For a leader to be effective, his behaviour and style must match the conditions in the situation (Daft, 1999). In Fiedler’s contingency model of leadership the ‘Least Preferred Co-worker’ (LPC) Scale was developed to measure whether a person is task oriented or relationship oriented. Leaders who score high on this scale are described as relationship-motivated and those who score low on the scale are identified as task-motivated (Fiedler and Garcia 1987, in Drummond, 2000). 

Figure 1: Contingency Model.

Source: Findings from F.E. Fiedler Model, Organizational Behaviour, 2001, U.S.A: Prentice–Hall

By combining the three contingency variables, there are potentially eight different situations or categories in which a leader could find themselves (Robbins, 2001:320). With knowledge of an individual’s LPC and an assessment of the three contingency variables, the Fiedler model proposes matching them up to achieve maximum leadership effectiveness (Fiedler, Chemers and Mahar, 1977). Based on Fiedler’s study of over 1,200 groups, where he compared relationship versus task oriented leadership styles in each of the eight situational categories, he concluded that task-oriented leaders tended to perform better in situations that were very favourable to them and in situations that were very unfavourable (Figure 1: Contingency Model).  Fiedler predicts that when faced with a category I, II, III, VII, or VIII situation, task-oriented leaders perform better. Relationship-oriented leaders, however, perform better in moderately favourable situations - categories IV through VI. Fiedler assumes an individual’s leadership style is fixed, either relationship-oriented or task-oriented (Robbins, 1995:142). So, if a situation requires a task-oriented leader and the person in that leadership position is relationship-oriented then either the situation has to be modified or the leader removed and replaced to achieve optimum effectiveness (Robbins, 2001:319-320).

Another approach to leadership theory is path-goal theory, developed by Robert House. Path-goal theory is a contingency model of leadership that extracts key elements from the Ohio State leadership research on initiating structure and consideration and the expectancy theory of motivation (House, 1971). Since expectancy theory proposes that motivation comes from the subordinates’ belief that s/he can do the job (self-efficacy) and gain useful outcomes (goal achievement), the role of the leader is to find or choose a style that matches subordinates’ motivational needs and also the demands of the task itself. The leader helps the follower along the path according to task and follower characteristics. The four leadership behaviours proposed are directive, supportive, participative and achievement-oriented leadership (House and Mitchell, 1974 in Francesco and Gold, 1998). A directive leader sets clear standards of performance and makes the rules and regulations clear to subordinates. Supportive leadership refers to being friendly and approachable as a leader and includes attending to the well-being and human needs of subordinates. A participative leader consults with subordinates, obtains ideas and opinions, and integrates their suggestions into the decisions regarding how the group or organization will proceed. An achievement oriented leader establishes a high standard of excellence for subordinates and seeks continuous improvement and s/he also shows a high degree of confidence that subordinates are capable of establishing and accomplishing challenging goals (Northouse, 1997:91).  However, the path-goal theory suggests that the different types of behaviour can be practised by the same person at different times in varying situations (Mullins, 2005).

The theories so far described, however, tend to support the ‘transactional’ approach to leadership more strongly, because they focus upon exchanges between leaders and followers whereby followers are rewarded materially or symbolically for achieving predetermined goals or targets (Drummond, 2000:78). Contingency approaches omit any analysis of gendered power relations in the work place.

Recent or new leadership theory (Bryman, 1992) originates from the work of James McGregor Burns (1978), who distinguished between transactional and transformational leaders. Transactional leaders see their relationship with followers in terms of trade, swaps or bargains, whereas transformational leaders are charismatic individuals who inspire and motivate others to go ‘beyond contract’- to perform at an unexpected level (Huczynski and Buchanan, 2001:729). More specifically, transformational leaders have charisma, give others inspiration, provide individualized consideration and intellectual stimulation. They lead effectively by attending to their followers’ needs and their potential for the developmental growth (Drummond, 2000:78).

It is important to note that transformational leadership theories have arisen “partly in recognition of the changing economic environment in which organizations operate” (Powell and Graves, 2003:147), an environment which is dynamic and ambiguous, calling for a different approach to a transactional approach. The new approach emphasises the importance of “employee involvement, interpersonal and team working skills and empowerment” (Metcalfe and Altman in Wilson 2001:116). Researchers and theorists see this approach as offering more opportunities for women to become leaders and as opening doors to examining gender as a variable in leadership, because the above characteristics, such as individualized consideration, are closely associated with femininity and, therefore, with many if not all women.

Microfinance spread across the globe as a means to alleviate poverty in the early seventies, and it is invented by Bangladeshi Economist Professor Muhammad Yunus. According to the Consultative Group to Assist the Poor (CGAP)1, Microfinance is the supply of loans, savings, and other basic financial services to the poor, including working capital loans, consumer credit, pensions, insurance and money transfer services. Similarly, Hossain (2002:79) defines MF as “the practice of offering small, collateral-free loans to members of cooperatives who otherwise would not have access to the capital necessary to begin small business or other income generating activities”.

A microfinance institution is an organization that offers financial services to low income populations (The Microfinance Gateway)2. The term microfinance institution has come to refer to a wide range of organizations dedicated to providing these services, for example, NGOs, credit unions, cooperatives, private commercial banks and non-bank financial institutions, and parts of state-owned banks. Throughout the 1980s and 1990s¸ NGOs and other non-bank financial institutions have shown that the poor repay their loans and are willing and able to pay interest rates that cover the costs of providing the loans. Moreover, financial services for the poor have proved to be a powerful instrument for poverty reduction, as they enable the poor to build assets, increase incomes, and reduce their vulnerability to economic stress3. That’s why, development NGOs and other social organizations have adopted microfinance programmes as a core component in their development interventions in several countries in Africa, Asia, Latin America and elsewhere (Hossain and Rahman, 2001:3).

The first and foremost objective of microfinance has been outlined as being poverty reduction. Empirical studies give strong evidence supporting that, although microcredit has had a positive effect on national development, it has failed to reach the poorest of the poor. Microfinance initiatives have been attacked by heavy criticism regarding high interest rates, exploitation of women, loan repayment, unchanging poverty levels and failure to effectively cater for the target groups (Mallick, 2002).

In view of the foregoing discussion, the main objective of the survey was to:

  1. examine the leadership types and patterns which are in practice in Grameen Bank, a leading microfinance institution in Bangladesh;
  2. determine gender representation and gender influence at different management levels of GB; and
  3. analyse leadership theories in operation at GB and possibilities of Gender Equity at GB.

In the following sections we will present our methodological approach and research context and then critically examine how leadership and gender work in a social development organization, Grameen Bank, Bangladesh.

Methodology and Research Context

Methodological approach

The study was carried out at the Grameen Bank (GB), a Bangladesh community development bank with its head office located in Dhaka.  The target population of the study was various levels of employees of GB head office. The information, findings and analysis throughout the research paper are the compilation of the contribution of the respondents. The authors conducted a small scale research survey with the main instruments used in this study being unstructured questionnaires and interviews. Data were collected through survey questionnaire and interview schedules from GB between January and March, 2009.

The total number of respondents was 40. Twenty respondents, 10 male and 10 female employees, were requested to fill in a questionnaire and another 20 employees, 10 male and 10 female, from various levels at the organization’s head office were interviewed. Out of the sample of 40, 13 employees were from top management, 14 senior officers were from middle management and 13 junior officers were from the entry level management in the GB.  Moreover, one set of questionnaires was used for male employees and another for female employees.

The main instruments used in this study were unstructured questionnaires and interviews representing (i) leadership practices in GB, (ii) gender influence in GB, (iii) barriers to women’s advancement in leadership roles, (iv) differences between ‘Male’ and ‘Female’ ways of leading, (v) gender versus contingency theories, and (vi) gender versus transformational leadership theories etc. In order to fulfil the objectives of the paper, the following issues have been originated, for example, employees idea about the vision, mission, and individual task responsibilities of the organization, existence of clear line of command in that organization and whether it is operating in an appropriate way, concern about  hiring female manager/ employees in GB, percentage of male and female employees and number of female employees in top management, middle management, and low management, and employees’ feelings while working under male/ female boss. Do they have any different experience working under different sex? Is the rewards/outcome the same compared to males working in similar positions? What is the decision making criteria (by voting/ discussion) of employees? In case of discussion, do they take opinions and suggestions from employees (male/female)? The status of current working environment (interactive or supportive) in GB, number of  interaction/meeting with the different levels of management, and whether it is helpful for an individual to be motivated, leadership types and patterns in GB and how it is operating, etc. The answer to these questions in general has been researched with special regard to leadership and gender in GB, Bangladesh.

About Grameen Bank

Grameen Bank is a specialised bank established in October 1983 as a corporate body under the Grameen Bank Ordinance 1983. The Bengali word ‘grameen’ means rural and reflects the fact that the bank emerged out of a rural banking project that began in 1976 at Jobra village of Hathazari Upazila (sub-district) of Chittagong district. GB is a microfinance organization in Bangladesh, that gives small loans (known as microcredit) to the impoverished without requiring collateral. Microcredit is now known to be a cost-effective weapon to fight poverty and it serves as a catalyst in the overall development of the socio-economic conditions for the poor4. GB borrowers do not have access to conventional sources of credit because they are poor. The loan and the accrued interest are repayable in small weekly instalments over a period of one year. The bank also provides comprehensive investment advice to its clients and helps them generate savings for themselves (Wahid, 1999).

Today GB is the fastest growing bank in Bangladesh and it provides services to 80,511 villages in Bangladesh. Borrowers from the bank own 90% of its shares, while the remaining 10% is owned by the government. Since formally becoming a bank in 1983, it has given out nearly 16 million tiny loans and enjoys an unparalleled customer loyalty5. The Grameen Bank instituted group liability instead of any collateral. Peer pressure works as a driving force for the borrowers to repay the loan on time. In case of default, the borrowers as well as other members of the group become ineligible for further loans. The loan-collection rate of the GB is nearly 98 percent, a rate that is far higher than that for any other conventional financial institution operating in the country (Wahid, 1999).

 Drawing attention to poverty, leadership and gender, the bank’s vision and values are translated into objectives as follows.

  1. To extend banking facilities to poor men and women. The plan is to take credit to the 1.3 billion poorest people of the world by the year 2025 and at present there are 168 GB replications in 44 countries (Grameen Bank Annual Report, 2005).
  2. To eliminate the exploitation of the poor by money lenders.
  3. To create opportunities for self-employment for the vast multitude of unemployed people in rural Bangladesh.
  4. To bring the disadvantaged, mostly the women from the poorest households, within the fold of an organizational format which they can understand and manage by themselves.
  5. To establish an equal ratio of women and men borrowers, sthough it has discovered that the women are highly effective agents of change.
  6. To allow professionalism and empowerment of staff, and also the promotion and leveraging of volunteerism where appropriate (Grameen Bank Brochure, 2006).  .
  7. In this study, we look at two major areas, leadership practices and gender influences, in Grameen Bank.

Leadership Practices in Grameen Bank

In Fiedler’s contingency approach to leadership, to understand the performance of leaders it is essential to understand the situation in which they lead (Northouse, 1997). The majority of participants in the survey, employees at all levels in the bank, say that they have a clear idea about the mission, vision and individual task responsibilities of the organization. Task structure is one of the situational variables. The employees usually get to know their job responsibilities from regular staff meetings, letters from senior personnel, seminars and also specific written job descriptions. One respondent says: “Every individual has a specific job and it is done through written document. Apart from this, sometimes verbal orders are also given. It depends on the nature of the task”. Similarly, one manager (HR) mentions: “I have got the idea about vision and mission from my top management. As I am now working in the HR department, it is my responsibility to prepare the job description for new recruits.” It has been argued that tasks that are completely structured tend to give more control to the leader, whereas vague and unclear tasks lessen the leader’s control and influence (Northouse, 1997). Another situational variable of Fiedler’s contingency model is power position. Regarding this variable, participants mention that this is strictly followed at the head office and that it runs smoothly. Most of the participants see their current working environment as both supportive and interactive. They view their colleagues as helpful. One respondent (a HR manager) says: “Here in this organization everybody is friendly and supportive and helps new employees to do their work smoothly”. Thus, it seems that a good working atmosphere exists. According to Fiedler’s contingency model, three factors determine the “favourableness” of various situations in an organisation - situations that have good leader-follower relations, well-defined tasks and strong position power are rated as most favourable (Northouse, 1997:76). These are found at GB. Leaders are task-motivated (low least preferred colleague [LPC] score) there and thus effective in both very favourable and very unfavourable situations.

In path-goal theory, four types of leadership behaviour are identified – directive, supportive, participative and achievement oriented. Results from the study indicate that GB leaders practice all these leadership approaches, depending on the situation. In the case of directive and participative leadership behaviours, a majority of those surveyed believe that the strict line of command in GB often creates problems, as it hampers co-operative behaviour. One Assistant Programmer states that “there is a lack of collective initiative, with non-cooperation and ego problems of seniors often hassling juniors in doing their work freely”. Respondents from senior and mid-level management say that discussion with all respective personnel is the basis for taking decisions in the organization, because they believe that participatory discussions help to take proper decisions. However, one Senior Officer suggests that “decisions are usually made by the senior officials. Little importance is given to the opinion of the juniors. They should also be welcomed to the process”. The necessity of participation in meetings with different levels of management depends on the job responsibilities of the individual employee. However, every respondent thinks that regular interaction with the reporting manager and with management at various levels can help the personnel to do their work efficiently and increase their confidence as well. The top management can interact with junior management frequently whenever they want, but in case of juniors, they can only have a meeting with the upper management once a week or in a month when it is scheduled. Interaction with top management sometimes depends on a person’s individual capacity also. Snap meetings called at short notice also help them to interact with management of different levels.  Another HR Manager says:  “… my reporting boss is so busy that I can only meet him two times a week. On the other hand, I consult my junior colleagues and take opinions from them. I think it is very important for generating motivation among the employees”.

Achievement-oriented leadership is characterized by a leader who challenges his subordinates to perform work at the highest level possible (Drummond, 2000:78). In some cases, leaders at GB exhibit this style of leadership. In fact, this variation in behaviour clearly illustrates the point that path-goal theory is not a trait-based theory that locks leaders into only one kind of leadership (Northouse, 1997:91). It explains how leaders in GB adapt their style to the situation and task or to the motivational needs of their subordinates but it remains unclear if this also occurs because of the personality of the leader or simply because of the varying circumstances (of task and people) in which they are working.

Most of the organization is now apparently moving towards recognizing a transformational style of leadership. This is concerned with values, ethics and long-term goals and encourages more of what the leadership theorists would term ‘feminine’ characteristics. In GB, the founder is a visionary who has won a Nobel award in 2006. However, interviews with the staff suggest that a transactional style of leadership is most commonly observed in practice. This is task-focused and it is the one that has had the most influence in daily operations and seems to have gained the most respect in the organization so far, while the powerful influence of the inspirational leader is felt more remotely. In many ways, this may be a reflection of leadership approaches in other effective organizations in the wider context of Bangladesh.

Gender Influence in Grameen Bank

Grameen Bank has long recognized the need to improve gender balance at all levels within the organization and is committed to promote equity. It has also been recognised that there is a need for a change in the attitudes of staff towards women. Although GB is driven by its female members to achieving its outstanding success, gender parity is totally absent. The head office of GB comprises many divisions. In the banking section, the lack of gender parity is especially marked. A communications manager notes, “Here in the head Office of GB the percentage of male and female employees differs in different management levels. In the top management, there is only one female employee while there are 8 male employees. In the middle management, the ratio is 2:12. and in the low level management there are 50 female and 95 male employees.”

 In this context, Hill (2001:17) referring to another context, states that, “there is a need for a change in the attitudes of staff with regard to gender relations and to increase the balance of women staff”. It is well-noted that nowadays women are getting employed at the entry level. GB prioritizes capable females excluded from various opportunities due to socio-economic reasons. An HR Manager says: “I am a member of recruitment committee of the organization. In our organization women are especially encouraged to apply. I set criteria for the candidates to be recruited.”  The study revealed, however, that due to the workload and lack of various fringe benefits, highly competent women often are not interested in working there.

It is recognised that to achieve greater gender equity within an organization requires a “change in organisational culture which goes beyond a gender policy” (Porter et al, 1999:97), to make the culture more in tune with Hofstede’s description of a feminine culture (Fowler, 1997). However, putting gender-sensitive rhetoric into practice is challenging because it requires getting into the ‘deep structure’ of organizational psychology and stereotyping which are culturally determined (Fowler, 1997:79). GB is more in tune with a role culture and pyramid structure (Harrison, 2002) that has encouraged the transactional form of management control described earlier. National as well as organizational culture also has implications for gender. The majority of work in the world takes place within national cultures that are more masculine and have social norms that expect women’s primary responsibilities to be in the home.  In some cultures, women are not permitted to travel or work late away from the home, a restriction which has significant implications when working in remote areas or working internationally. Dominant masculine behaviour hinders women from playing a leadership role to the full. May (in Fowler, 1997:78) has cited other obstacles to a more feminised organizational culture in the Non-Governmental Organization (NGO) sector, including the “working hours and lack of facilities”. Such working patterns put incredible pressure on women who continue to have family responsibilities. However, Due Billing and Alvesson (2000) suggest that getting more women into management will result in a significant transformation of the workplace, because there are other factors at play. GB through its mission statement is, in principle, calling on managers not to ‘replicate the general pattern of national culture’ (Fowler, 1997:75) which, in the case of Bangladesh, replicates the above undesirable characteristics. In practice, the limited evidence from the study suggests that this call has not yet been heard clearly and the wider cultural values regarding the role of women is paradoxically replicated at certain levels in the organization itself, despite its overtly pro-women agenda.

It is notable that the working environment in GB is very good and hence male employees do not have a problem working under a female boss and vice versa. Another interesting finding is that employees under a leader of the opposite sex feel better towards their work. As they argue, bosses of opposite sex usually are kind to their subordinates. As one Manager, Communications, says: “I feel better to work with my female coordinator. Her personal conduct is excellent and she is very easy to communicate with and easier to get a decision, compared to others”. However, this is not always the case. One Senior Executive (female) says: “I have a male boss and have a bad experience working with him. Due to his family problems, he does not give much attention to office work and employees. Sometimes it creates problems in completing my regular tasks.” In senior management, as we have noted, a gender disparity prevails, and as a result females often are absent or unrepresented in the decision-making process. However, in the lower ranks, participation of both male and female employees is more widely observed. Moreover, the female employees feel that they are working in GB quite legitimately on their merits and have proved their competence compared to their male counterparts. They get rewarded in the form of promotion in due course, on the basis of seniority, just as their male colleagues do and no special reward is given to encourage female employees to work efficiently. As an Assistant Programmer observes: “Very often I get thanks from my supervisor but nothing officially”. Thus, we can note that recognition for effort, which significantly contributes to job satisfaction, performance, and also motivation of employees, is often absent from the formal structures of performance management in Grameen Bank.

Further Analysis of Major Research Findings

Barriers to Women’s Advancement in Leadership Roles

Throughout history, research indicates that there is a tremendous amount of bias against women who achieve. Currently, the world population is about fifty per cent males and fifty per cent females, but the world’s leadership positions are only five per cent female, which represents a very nominal involvement. Bass (1981: 492) points out that the role of women in society is primarily culturally determined and that what women can and cannot do is culture-based. However, in a survey of women managers in a liberal, developed country context, 90% of those surveyed felt that the ‘glass ceiling’6 was the most significant problem facing women managers; 80% said that women were under-represented at the executive level. The research into GB shows that the organization does not have any reservations about hiring female employees for the roles already mentioned, as they found that women work competently in their individual positions. Although they are competent enough, their voices, nevertheless, are often ignored in top management level decision-making.

Pay inequities exist as well, as shown by several studies that indicate that women frequently find themselves in positions with little line authority and relatively low pay (Cook, 1987; Salmans, 1987 in Northouse, 1997). In GB there is no difference in payment system for male and female employees in the same position. Furthermore, Frank and Katcher (1977, in Bass, 1981: 493) argue that men tend to stereotype women’s behaviour as inappropriate for leadership roles and thus cannot conceive of a woman with legitimate power controlling others. That is why they exclude women from leadership positions. We also see from our research findings that the number of women in executive positions in Grameen Bank is very low compared to men. Roles and stereotypes cause problems for women, but not for men, because of the inherent conflict between being a partner and/or mother on one hand and an employee on the other (Wilson, 2001). In the same manner, other research by Rosen and Jerdee (1973, 1974 in Bass, 1981) shows that male administrators discriminate against female employees being recruited to make personnel decisions. Robie (1973) argues that such discrimination is justified on the basis of higher female absenteeism, turn-over and lack of geographical mobility, particularly if they are married or have children, an argument which is politically unacceptable in theory but perhaps widely invoked unofficially in hiring decisions.

Currently, GB offers loans to approximately seven million people, 97 per cent of whom are women. The reason for this high percentage of women is that women borrowers can make the most productive use of the loans and succeed in their business more than do men. In GB, while they work for the good of other women, women employees appear to be held back from taking on a full range of all leadership roles in equitable proportion to the number of men in the organization and the wider society. It may be that such barriers are also operating in unrecognized ways in the organization. Sweetman (2000:5) also identifies violence and mental intimidation as the ultimate barrier to women’s leadership at all levels of society, from household to state.

Differences between ‘Male’ and ‘Female’ Ways of Leading

Most theories of leadership have ignored women, and leaders usually seem to be men. Hence, questions arise, such as Do women lead differently from men?  Do women lead better than men? Kabacoff and Peter’s (1998) research shows that in many ways men and women approach the leadership role in a similar fashion, but it also finds significant differences in leadership behaviour. Their findings are categorized under two major headings: i) Task versus Strategy and ii) Expressiveness versus Constraint. Women tend to be more task and result-focused, while men take a more strategic and thoughtful approach. Also, women are more expressive and keep others enthusiastic in the working place, whereas men are unemotional and objective in manner. On the other hand, Purcell (1960, in Bass, 1981) states that women exhibit stronger loyalty to the company than men. Bass (1981) points out that on average, women’s self-confidence is lower than that of their male counterparts. Supporting this viewpoint, Maccoby and Jacklin (1974) argue that females have less confidence in a wide variety of activities, such as problem-solving and the ability to deal with emergencies, although they are superior to men in communication skills. It was found in GB that male respondents agreed with aspects of this research – specifically that women are more loyal and stronger in their work commitment. Helgensen (1990) suggests that men attach more importance to hierarchical relationships, whereas women attach more importance to networks and ‘webs of connection’, because a leader can get information from a variety of sources, rather than depending on the chain of command. Rosener (1990) argues that “the command and control leadership style associated with men is not the only way to succeed.” In this context, the findings from GB reveal that female employees were better at sharing information than were their male counterparts.

Conversely, Eagly and Johnson (1990 in Wilson, 1995:158) comment: “there was no consistently clear pattern of differences  ... in the supervisory style of female and male leaders”. Kanter (1977 cited in Wilson, 1995:158) asserts that “no research evidence…makes a case for sex differences in leadership aptitude or style”. These findings suggest that there may be some danger in talking about male and female ways of leading. So what does this mean for the theories on gender and leadership? One obvious answer is that “if we implicitly believe that men and women do have differences in style then this may be due to the stereotypical images we have about men and women” (Wilson, 1995:158) rather than any differences actually existing. In fact, other research has also found that once legitimized as a leader or manager, women actually do not behave differently from men in the same kind of positions (Bass, 1990). Overall, however, there are more differences than similarities between men and women in their behaviour. From the survey in GB, no clear differences between male and female ways of leading were found.

Gender and Contingency Theories

One aspect of contingency theory suggests the optimum way for leaders to shape their leadership style depends on the type of follower involved (Hersey and Blanchard, 1977). Fiedler describes two different aspects of leadership behaviour-task focused behaviour and relationship-focused behaviour. Task behaviour is associated with a more directive approach, where the leader spells out the responsibilities of an individual or a group. In some situations, high levels of task-focused behaviour but low levels of relationship-focused behaviours are effective; in other situations, the opposite is true (Northouse, 1997). Moreover, the path–goal model explains that the leader’s role is to improve the subordinate’s perception of effort, performance and desired outcomes (Francesco and Gold, 1998:152). To do this, the leader should adapt his/her style to various situations. Kreitner (2002) states one valuable contribution of path-goal theory is its identification of the achievement-oriented leadership style. As managers deal with an increasing number of highly educated and self-motivated employees in advanced-technology industries, they would need to become skilled facilitators rather than just order givers or hand holders. On the other hand, DuBrin (1995:292) argues that many directive (authoritarian) leaders achieve good results without damaging morale. In practice, in GB, directive, supportive and participative leadership behaviours are all used by leaders, depending on the situation. In some cases, they also practice achievement-oriented leadership style.

The study of leadership has revolved around the public domain (Wilson, 1995) and has been seen as belonging to the workplace only. Traditionally, men have been seen to occupy the public sphere and women the private because of the latter’s ability to reproduce. Since women are under-represented in leadership positions (Rhode in Ely et al., 2003:159), in organizations where research has been carried out the applicability of theories to the workplace has been tested on men (Metcalfe and Altman, in Wilson, 2001), and where women did hold leadership positions, researchers tended to exclude them in case they skewed the findings. And as theory and research focused on public domain leadership, which equates with formal positions of authority and power, leadership as a possible combination of behaviours that are adopted in many private domain activities has been ignored. Although, Due Billing and Alvesson (2000) question whether leadership experiences within the home can transfer easily to the workplace, contingency theory does not even attempt to relate leadership with gender in the workplace. It merely points out how important the leader’s style, the follower and the situation are in terms of producing effective leadership behaviours.

Gender and Transformational Leadership Theories

Sarros and Santora (2001) summarize criticisms of transformational leadership theory. While Northouse (1997) points to a lack of clarity of concept, Bryman (1992) draws attention to overlaps with similar leadership frameworks, for example, with that of charismatic leadership. Bass (1990), in turn, considers charisma is, in fact, only one aspect of transformational leadership. Francesco and Gold (2005) feel that in ‘high power distance’ societies, there are limitations to the use of transformational leadership approaches since leaders’ and followers’ expectations are significantly different. The cultures do not promote the intermingling of leadership and subordinate roles. The transformational leadership style is apparently ‘gender free’ and encourages behaviour that is associated with women according to Rosener (1990). Defining transformational leadership as ‘interactive leadership’, she suggests that men tend to describe themselves as transactional leaders, whereas women describe themselves as more transformational, because women prefer (i) participation, (ii) making people feel energized and important, (iii) sharing information and power and (iv) placing less emphasis on formal power. A UK study (Wilson, 1995) provides similar findings on women’s perception of leaders as catalysts or visionary leaders. However, Lee (1994 in Wilson, 2001:116) sounds a cautionary note, pointing out that “identifying a talent to nurture participation and inclusion as a female strength is not the same as assigning that ability to the exclusive domain of women”, while still accepting that men and women do lead differently. So, it is clear that women have the characteristics of transformational leadership and can contribute more for organisational success when this approach is adopted.

Conclusion

Grameen Bank still applies a transactional leadership style in its organization, while it has also been established that a transformational leadership style can help it achieve significant success in the world.  We can say that a transformational leadership style would open more doors to women in the organization. Certainly, one might presume that opportunities will be increased for those women (and men) who display more of the ‘feminine’ characteristics that transformational leadership implies.

In conclusion, the authors suggest that GB can achieve a transformational leadership quality by organizing varied training including participating in workshops, seminars and group discussions. Top management should evaluate the employees’ work properly and neutrally. Promotion or upgrading of an employee should only be done on the basis of performance and merit, because traditional reward based on seniority can promote personnel who are not fit for that specific position. Effective reward systems, a more cooperative office environment, a neutral attitude from the top management, adequate training sessions for employees and strict following of office hours can improve the leadership practice in the organization. Finally, gender balance at all levels within the organisation is urgently required to value diversity and promote equity.

End Notes

1 & 3 CGAP: Building Financial Systems for the Poor, http://www.cgap.org/about/faq01.html

2 The Microfinance Gateway, http://www.microfinancegateway.com/section/faq#Q1

4 & 5 Grameen Bank: Banking for the Poor, http://www.grameen-info.org/,

6 The glass ceiling metaphor describes an invisible barrier to the advancement opportunities of women within organizations (Northouse, 1997: 215).

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