The UK economy is missing out on a major boost by society’s failure to encourage more women to set up their own businesses, according to new research.
A study by the Chartered Institute of Personnel and Development (CIPD), called Inspiring Female Entrepreneurs, says that if there were as many female entrepreneurs in the UK as there are male, the economy could be boosted by as much as 10% by 2030. It draws this conclusion after having interviewed a number of leading businesswomen.
It says that women “tend to be motivated more by a sense of purpose than by solely the prospect of generating wealth”, and so are therefore often better suited to entrepreneurship and high-ranking corporate roles than their male counterparts.
This is on top of being more financially astute, possessing more personal approaches to marketing and customer relationships, demonstrating greater business acumen and better protecting brands and reputation.
Dianah Worman, public policy adviser at CIPD, said, “Employers need to act out of self-interest to broaden the pools of talent available to them and ensure they do not lose out on the skills, energy and passion women can bring to their workplaces if they were allowed to work more autonomously and flexibly.
“Government is right to actively stimulate the wider take up of flexible working by employers and to seek to support women in setting up and growing their own enterprises. It makes perfect sense to find ways of helping them to do this in order to build economic growth.”
In 2010, women made up only 12.5% of the members of the corporate boards of FTSE 100 companies – up from 9.4% in 2004.
Meanwhile just 37% of new public appointments made by government departments in 2012 to 2013 were female. The Cabinet Office recently gave its backing to efforts to increase this figure to 50% by 2015.
Consulting firm McKinsey & Company has been researching the impact of female representation in boardrooms since 2007. Its study was cited in a 2011 government-commissioned review, led by Lord Davies of Abersoch, which concluded, “Evidence suggests that companies with a strong female representation at board and top management level perform better than those without and that gender-diverse boards have a positive impact on performance.”
The Women on Boards organisation was set up in 2012 to help women make it into board and leadership roles.
Meanwhile, anecdotal evidence suggests that females are better represented in top sustainability jobs than they are in mainstream sectors. Penny Shepherd, the former chief executive of the UK Sustainable Investment and Finance Association (UKSIF), told Blue & Green Tomorrow in June that being a woman had “always been an advantage” for her, and that in her experience, females often take the lead on issues like ethical investment.
She said, “There’s a disproportionate number of women in top sustainable finance jobs, compared to mainstream financial services.
“But even going back to the 1990s, although the majority of private investors at that point were male, you had equal numbers of male and female ethical investors. Compared to their representation in the investment market, women were more likely to be ethical investors.
“And women have an increasing amount of wealth. In fact, there’s an argument that says one of the drivers for the growth of retail ethical investment has been the increasing amount of money in the hands of women – either as a result of having careers, or outliving their husbands.”
The CIPD research added that some 2.4 million women in the UK were currently unemployed but wanted to work. It also called for greater access for females to advice, guidance, planning and training.