The barriers between the sexes have come tumbling down in recent years, and nowhere more so than in business.  More women are in employment than ever and more are working their way to the top of the executive ladder.  But they’re still behind the men – in terms of volume at least.  Ladies, what’s going on?

There’s no technical reason that I can find for women not being more dominant in the business world.  It’s certainly not an issue of intelligence (applied or theoretical) or capability.  And I certainly don’t buy the argument that women are behind men in the business sector because they are the ones giving birth and looking after the child.  Whether you wholly buy the sexual equality argument or not, men are certainly more than capable of staying at home and bringing up baby, using a microwave or the vacuum cleaner. 

And yet, in years past, a woman’s ‘job’ has not been spearheading companies, but rather taking time out to raise families.  This has been seen as ‘woman’s work’, and one has to wonder whether this is accountable for the striking differences between the business environments of men and women.

Consider, for example, the number of women entrepreneurs compared to male: 1.0 million as opposed to 2.7 million (Women’s Business Ownership, Professor Sara Carter, 2006).  That’s a big difference.  Men are therefore, looking at current statistics, twice as likely to be entrepreneurially active than women – but this situation is changing.  Back in 2001, men were 2.5x more entrepreneurially active – so women are closing the gap with a decent degree of rapidity.

In the South East, we currently have approximately 165,000 female entrepreneurs, and if women matched the rate of male start-ups, we’d see 25,000 new businesses spring up in this region alone!  This would mean a seismic shift in the local economy and in the business gender balance. 

The figures for majority female owned businesses are even more staggering – just 15% of the UK’s total business stock is owned by the fairer sex (Promoting Female Entrepreneurship, SBS, March 2005).  And yet this 15% generates £130billion in turnover each and every year.  So ladies might not be dominating in percentage terms, but the businesses that are female owned are contributing massively to the national economy.

There are some really interesting statistics out there encouraging female enterprise including:

• Each pound invested in a female own business provides a greater return for the investor than a male-owned business (CEO of Small Business Service, Martin Wyn Griffith)
• Around one in five women come into self-employment from unemployment – the figure for men is around one in fifteen (Promoting Female Entrepreneurship, SBS, March 2005)
• If women started businesses at the same rate as men, we’d have around 150,000 new businesses cropping up each year – and one can only guess at the positive impact this would have on local, regional and national economic growth.

So why do women not hit the business world with the same force as men?  Part of the reason is the fear of failure (around a third of women would take the plunge if it wasn’t for this) and the fear of debt, both of which are felt more highly by women than men.  It’s therefore unsurprising to learn that far more women seek advice when they do take the plunge than men – and on that point, have you ever seen a man ask for directions? 

It’s also interesting to examine the motivations for women starting their own business compared to their male rivals.  Well over half of women entrepreneurs will tell you that they struck out on their own so that they could choose what hours to work (only around a third of men will admit to this), and a staggering ten times more women became self employed to work around their family commitments (Source: Women & men Business Owners in the United Kingdom). 

Perhaps the traditional family ‘values’ of the woman looking after the child rather than the man aren’t being challenged as widely as is often thought.  A study (The Barriers Start to Fall – Barclays) back in 2000 showed that 80% of women were pretty much solely responsible for looking after the young ‘uns or arranging their care.  This fluctuates on a yearly basis but it appears that, under a skin of equality, women are still seen to be the ones responsible for raising a family – and as any mother will tell you, that’s not easy.  So to juggle being an entrepreneur as well as a family takes something quite special.

There are other factors as well that appear to weigh against women starting their own business.  According to the Department of Trade and Industry, loans given to female owned business average a 1% higher rate of interest than those given to male owned companies.  Why?  Well, to be honest, I don’t know and haven’t been able to find out.  However, this seems to smack of blatant sexism in the lending sector and I’d be very interested to see the research that lenders have done to show that it’s justified raising the interest rate in this way - if anyone has any answers to this, please let me know.  It is especially interesting given the findings of The Small Business Service (USA admittedly) that the rate of investor returns is much better with women than men.

While we’re considering some of the reasons behind the proportionally lower figures for female entrepreneurship than male, it is worth considering the issues of maternity and paternity leave.  While us males can quite easily change, feed, bathe and burp the wee bairn, we really can’t bear them (as in gestate, rather than ‘can’t stand’!).  Mothers therefore have certain rights – quite correctly – regarding time off work to give birth to and spend important formative time with their children.

In fact, this time can be up to 52 weeks as any HR company will tell you.  Granted, not all of it is paid at full salary, but she can take a year away from her job and return to either her own job or one of equivalent worth (financially and to the company) with similar levels of power and responsibility. 

However, for men, the situation is really quite different.  Although we now have statutory rights to paternity leave (since April 2003), it’s only two weeks.  Do we therefore take it that men are more valuable to the UK’s economy than women and that they can only be spared from their desks for a fortnight? 

Naturally, the mother can return to work before the end of the 52 weeks maternity leave (normal length of leave is usually around 26 – 39 weeks) should they so choose and a lot of this will be dependent on negotiations between employer and employee.  The discrepancy between the length of statutory leave for men and women surely can’t help the business balance in the economy.

There’s a whole can of worms that can be opened by continuing this line of thought, including the psychological effects of motherhood, societal conventions/expectations and maternal/paternal bonding with the child – all of which impact in some way on a woman’s decision to have children and work (or not as the case may be).  However, I think that most will agree that this isn’t the right forum in which to discuss such issues.  So I will simply leave it with the following thought:  if paternal statutory rights were the same as those for a woman, would this make a marked difference on the gender balance of the UK economy?

The inequalities between men and women in entrepreneurship are only part of the argument – women are still vastly under-represented at Board Room and Director level throughout the county.

From some research conducted in 2006, it is interesting to note that:

• 77 FTSE 100 companies have women directors on their boards, compared to 57 in 2001.
• 13 FTSE 100 companies now have female executive directors – up from only 11 in  2005, but still indicating a major under-development of female talent.
• 102 females hold 13.7 of all non-executive director seats.
• 117 females hold 10.3% of all FTSE 100 seats, down from 121 in 2005
• 23 companies have no female board members.
• The top spot is AstraZeneca with 4 female non-executives, making 28% of their corporate board – closely followed by British Airways with 3 female non-executives making 27.3% of the corporate board.  In third place is Lloyds TSB, with 27%; followed by HBOS.  In joint fifth place are Pearson, and Legal and General.

Last year’s report identified the substantial female talent pool for future FTSE 100 non-executive directors and executive director positions - this totalled 344 women.  The challenge is how to connect these talented women to future FTSE 100 NED executive director vacancies
[Source: www.womenandequalityunit.gov.uk/boardroom_diversity/]

This is interesting for a number of reasons, not least why women are seemingly so under-represented at Board/Director level within the FTSE 100 companies.  Is it because these companies are ‘Old Boy’ clubs unwilling to accept a woman into their ranks, or is because women aren’t interested in reaching this level because of motherhood, the great propensity for women to value families over work and so on?  Or is it a situation that has occurred historically and will take some time to reverse?  It certainly will be interesting to see how these companies change as the effects of changing socio-economic responsibilities come into play and the recent generation of female graduates work their way up the career ladder.

One area of continuing contention is the pay gap between men and women – which is currently running at 12.6% for full time employment and a staggering 40.2% for part time work (the pay gap expresses the difference between men’s and women’s median hourly earnings) [Source: Women and Equality Unit – www.womenandequalityunit.gov.uk]

According to the Women and Equality Unit (WEU), there are many arguments for why the gap exists, including:

• Travel patterns – women don’t tend to commute as far as men, which limits the job pool accordingly
• Human Capital differences – i.e. differences in education and work experience levels.  The WEU states that women are more likely to take time out to look after children and other dependants and this effects their work experience levels.  Education is a different matter and largely refers to educational imbalances between the sexes – although with more young women achieving higher grades than ever before (beating the boys into a cocked hat in some case) and following through to university, this will alter the gap
• Occupational segregation – 60% of women work in just 10 industries which are among some of the lowest paid
• Part time working – the percentage of women in part-time jobs is higher than that for men, so this also affects the pay gap.

Of course, these arguments are generalised but do go some way to explaining the existence of the gap.  The rights and wrongs of the situation are another matter entirely and won’t be covered here for much the same reasons that we’re not looking at psychological implications of motherhood.

It’s quite interesting to look at the differences between men and women within the business world.  For example, female entrepreneurs are three times more likely to collaborate with universities and other research institutions than men, but they do not collaborate as much with their competitors as men do (Achieving the Vision, Female Entrepreneurship, British Chambers of Commerce July 2004).  This seems to run with a theme of female entrepreneurs keeping their products and services close to their collective chests and utilising every available opportunity to improve/develop their offering rather than ‘going it alone’. 

Further to this, entrepreneurial ladies are much more likely to have fewer competitors and introduce new products to the market than men.  Interestingly, women also are more likely to use technology in their products than men and launch products/services which have been developed in the previous year. 

Taking the above into account, it seems that women are more careful with starting their businesses, take more advice from more sources more often, are more secretive and more willing to challenge the existing market place than men are.  It doesn’t show us males in the best light, does it?!

There are many initiatives out there to help encourage more women to choose entrepreneurship as a career choice at the local, regional and national levels.

Organisations such as Enterprise Gateway hold regular women-only meetings, giving female entrepreneurs the chance to benefit from peer-to-peer support and get advice on anything to do with their business.  Other organisations, such as PROWESS (www.prowess.org.uk) support the growth of women's business ownership through the development of an effective women-friendly business support infrastructure and enterprise culture.

Then there’s the Women In Business Network (www.wib-sussex.co.uk) which covers large tranches of the country.  As a paid membership organisation, they fulfil many similar functions to the Arun Business Partnership with networking meetings, seminars, meet-the-buyer type events etc – but only for the ladies!

There can be no doubt as to the worth of the UK’s female entrepreneurs and, with the right support, guidance and advice, I’m fairly sure that we can expect the current gender inequalities in the business sector to iron themselves out in the medium term.  Until then, the Government’s Women and Equality Unit have issued some helpful ‘top tips’ to any women thinking about starting her own business:

1. Get networking
2. Have the right skills
3. Raise your profile
4. Learn how to sell yourself
5. Be specific about what you have to offer
6. Identify fertile ground
7. Take on leadership positions
8. Get board experience
9. Believe in yourself
10. Persevere

Thinking about it, maybe business advice for men and women isn’t so different after all!

We’ll be interested in hearing your views, experiences and thoughts on the topics raised in this article.  Contact Neil – This e-mail address is being protected from spam bots, you need JavaScript enabled to view it – and we’d be delighted to return to this topic.

Links to women-only business organisations

• www.the-bag-lady.co.uk
• www.bawe-uk.org
• www.busygirl.com
• www.bpwuk.co.uk
• www.everywoman.co.uk
• www.wib-sussex.co.uk
• hwww.prowess.org.uk
• www.thewomensnetworkingcompany.com

For some interesting reports on Women’s networking and business development, visit www.som.cranfield.ac.uk/som/research/centres/cdwbl/news.asp