Relevance of gender in the policy area

Entrepreneurship plays an important role in creating jobs, innovation and growth. Fostering entrepreneurship is a key policy goal for governments who expect that high rates of entrepreneurial activity will create sustainable jobs. Self-employment, also contributes to job creation in Europe, as 30% of the self-employed have employees of their own. European-level data indicate that the self-employment sector has shown a degree of resilience during the recent economic crisis, as the relative decline in self-employment has been more moderate in comparison with salaried employment.

Against this backdrop, interest in women’s entrepreneurship has grown among scholars and policymakers. While the rationale for women’s entrepreneurship has traditionally focused on enhancing women’s equality, empowerment and social inclusion, its development is now seen to make good economic sense. Only in recent years has it become clear that women entrepreneurs can be a powerful economic resource. World Bank studies show that women entrepreneurs make significant contributions to economic growth and poverty reduction, not only in developing countries but also in high-income countries. Women entrepreneurs create new jobs for themselves and others. Besides boosting employment, women’s entrepreneurship also supports the diversification of business, stimulating innovation and diversification in management, in production and marketing practices as well as in products and services. Women provide different solutions to management, organisational and business problems.

Despite the growing interest in women’s entrepreneurship and the radical increase in numbers over recent years, the potential of women’s entrepreneurship has only recently started to materialise. This is clearly evident in the Global entrepreneurship monitor (GEM) 2010 women’s report general, which examined the rates of entrepreneurship in 59 countries and showed that in all these countries, the rates of women’s entrepreneurship were lower than men’s. A multi-year analysis (2002 – 2010) presented in the report shows that this gender gap has persisted across most economies through the years. Indeed, despite women’s increasing participation in the labour mar­ket, women remain substantially under‑represented among self‑employed workers. On average, during the 2008 – 2012 period, the share of self‑employed women compared to the total number in employment is much smaller than the corresponding share for men, across the EU-28 Member States: 10% compared with 18%.

The number of woman entrepreneurs has changed little in OECD countries. The proportion of women-owned businesses currently lies at around 30% of the total number of businesses in OECD countries. When women do start businesses, they do it on a smaller scale than men and in a limited range of sectors. In addition, self-employed women experience severe gender gaps and may earn 30% to 40% less than their male counterparts.The gen­der pay gap for self‑employment stands at 45% at EU level, which vividly illustrates the extent of the disparities between women and men in this type of employment.

Despite a major difficulty in examining and measuring entrepreneurship due to the blurred boundaries separating it from self-employment, the literature shows that women still face a great number of difficulties and obstacles in establishing and running businesses. These include:

  • access to finance
  • unfavourable business regulations
  • cultural barriers
  • choice of business types and sectors
  • information and training gaps
  • lack of contacts and access to social support and networking
  • education and occupational segregation
  • competing demands on time (double burden of home and work responsibilities).

Gender inequalities in entrepreneurship include the following:

  • access to credit, finance and capital
  • networking opportunities for women entrepreneurs
  • horizontal gender segregation
  • reconciling work and family life
  • prejudices and stereotypes about women in business.

Gender inequalities in the policy area - Main issues

Existing gender equality policy objectives at EU and international level

In the past few decades, the role and contribution of women’s entrepreneurship to economic empowerment, economic growth and society and sustainable development at large has been recognised on the part of national and international institutions.

EU level

Women’s entrepreneurship is a key issue for the European institutions. Since 2005, to ensure that SMEs would benefit from the measures identified in the Lisbon Strategy, the European Commission undertook to work with national authorities to address those areas, such as access to credit and entrepreneurial networks, where the needs of women entrepreneurs were not sufficiently met.

The European policies for women entrepreneurs have therefore pursued first of all the main objective of spreading entrepreneurial mindsets among women, encouraging and financially supporting the start-up of business activity by women.

European Commission

In 2008, three lines of action were developed at EU level in relation to female entrepreneurship: better access to finance for women, development of entrepreneurial networks for women and targeted support measures envisaged in the Small Business Act. The Commission adopted a regulation that extends the granting of state aid to new enterprises created by women and has supported the creation of networks of women entrepreneurs.

The EU Strategy for equality between women and men 2010 – 2015 adopted in 2010 includes, under the priority of equal economic independence, references to women entrepreneurship.

In 2012, the European Commission drafted the Entrepreneurship 2020 Action Plan in which it stresses that entrepreneurship makes economies more competitive and innovative and it is crucial in achieving the objectives of several European sectorial policies. Emphasis is also placed on social entrepreneurship whose potential is often underestimated, but that generates sustainable jobs and has demonstrated a stronger resilience to the crisis than the general economy.

On this basis, the plan is structured around three main action pillars:

entrepreneurial education and training to support growth and business creation
strengthening framework conditions for entrepreneurs by removing existing structural barriers and supporting them in crucial phases of the business lifecycle
dynamising the culture of entrepreneurship in Europe: nurturing the new generation of entrepreneurs.

While not specifically addressing women entrepreneurship, the plan invites Member States to:

design and implement national strategies for women’s entrepreneurship that aim at increasing the share of women-led companies
collect sex-disaggregated data and produce annual updates on the state of women entrepreneurs nationally
continue and expand the existing networks of female entrepreneurship ambassadors and mentors for women entrepreneurs
implement policies enabling women to achieve an adequate work–life balance, by establishing appropriate and affordable care for children and elderly dependents, notably by taking full advantage of support options under the EAFRD, ERDF and ESF.

European Parliament

In 2010 the European Parliament adopted a Directive amending the previous regulations to ensure greater protection to women who are self-employed. Through it, the principle of equal treatment between women and men has been extended to self-employment. This Directive considerably improves the protection of female self-employed workers and assisting spouses or life partners of self-employed workers, also in the case of maternity: they are granted a maternity allowance and a leave of at least 14 weeks. At the EU level, this is the first time a maternity allowance has been granted to self-employed workers. By improving the social protection available to women in the labour market, it is expected that it will increase the share of women becoming entrepreneurs, even though from the opposite viewpoint it may be seen as overregulation of micro-businesses.

In September 2011, the European Parliament adopted a resolution on women entrepreneurship in small and medium-sized enterprises, where a female entrepreneur is defined as a ‘woman who has created a business in which she has a majority shareholding and who takes an active interest in the decision-making, risk-taking and day-to-day management’. The resolution also recognises that, even if ‘female entrepreneurship and female SMEs provide a key source for increasing the degree of female employment’ and ‘an increase in the number of women entrepreneurs resulting in a positive impact and an immediate contribution to the economy overall’, female entrepreneurs still face many barriers and obstacles (access to informational support, financial and technological tools, etc.) and the potential of female entrepreneurship is ‘far from being harnessed in the European Union’.

Therefore the resolution, acknowledging that ‘promoting women’s entrepreneurship is a long-term process that requires time to change structures and attitudes in society’, provides a series of recommendations to Commission, Member States and regional and local authorities in the areas of access to financial and educational support, to traditional business networking opportunities and to information and communication technologies.

Moreover, in 2011 the European Parliament adopted another resolution on women and business leadership with which it asks the European Commission to monitor in detail the phenomenon of women in management and business.

Council of the European Union

The Council of the European Union adopted in 2011, the European pact for gender equality for the period 2011 – 2020 in which gender equality is recognised as a fundamental value of the European Union as it stimulates economic growth, prosperity and competitiveness. Among the measures proposed to combat segregation in the labour market is also included the promotion of women entrepreneurship and the participation of women in political and economic life.

Policy cycle in entrepreneurship

Click on a phase for details

How and when? Entrepreneurship and the integration of the gender dimension into the policy cycle

The gender dimension can be integrated in all phases of the policy cycle. For a detailed description of how gender can be mainstreamed in each phase of the policy cycle click here.

Below, you can find useful resources and practical examples for mainstreaming gender into entrepreneurship policies. They are organised according to the most relevant phase of the policy cycle they may serve.

Practical examples of gender mainstreaming in entrepreneurship 

Timeline

The key milestones of the EU entrepreneurship policy are presented below.

Current policy priorities at EU level

Small and medium-sized enterprises (SMEs) are the backbone of Europe’s economy. They represent 99% of all businesses in the EU. In the past five years, they have created around 85% of new jobs and provided two thirds of total private sector employment in the EU. The European Commission considers SMEs and entrepreneurship as key to ensuring economic growth, innovation, job creation and social integration in the EU. Some of the challenges to be tackled include:

  • education should offer the right foundation for an entrepreneurial career
  • difficult access to finance and markets
  • difficulty in transferring businesses
  • the fear of ‘punitive’ sanctions in case of failure
  • burdensome administrative procedures.

The overarching policy of EU for entrepreneurship and SMEs can be summarised as follows:

  • Creating a business-friendly environment: At the centre of the Commission’s action is the Small Business Act for Europe (SBA) that provides a comprehensive SME policy for the EU and EU countries. The SBA promotes the ‘Think small first’ principle and promotes entrepreneurial spirit among European citizens, and more on a business-friendly environment.
  • Promoting entrepreneurship: The Commission promotes entrepreneurship through the Entrepreneurship Action Plan, supports entrepreneurship education, and provides support tools for aspiring entrepreneurs.
  • Improving access to new markets and internationalisation: The Commission’s priority is to ensure that enterprises can rely on a business-friendly environment and make the most out of cross-border activities, both within the EU Single Market and outside the EU.
  • Facilitating access to finance: Access to finance is the most pressing issue for many small enterprises. The Commission works on improving the financing environment for SMEs and provides information on funding. The Late Payment Directive strengthens businesses’ rights to prompt payment.
  • Supporting SME competitiveness and innovation: Promoting competitiveness and innovation are key aspects of EU policy in relation to industry and enterprise, in particular for SMEs.
  • Providing key support networks and information for SMEs.

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