Part 1

The plight of fostering women entrepreneurship and women entrepreneur role in economic development evolved in early 1970s through the International Labour Organisation Report on Informal Sector. The attention on women’s roles focused in particular on how women served development aims. It is noted that the disciplines of Women in Development (WID) and Gender and Development (GAD) grew through the 1980s and 1990s respectively, and within these disciplines there were those focusing on fostering women entrepreneurship and Micro and Small Enterprise development.

They identified women’s important presence within the Micro and Small Enterprise sector in developing as well as developed countries as well as constraints limiting their contributions.These constraints included lack of: access to financing; information; productive resources and markets; high levels of skills and knowledge and relevant education and experience. Other constraints included effects of market saturation and compliance costs.

Women entrepreneurs often have difficulty accessing loans. In some cases, this is due to the requisition of smaller loans that are not profitable for formal financial institutions to offer. Banks may not have enough information about them hence unwilling to advance loans due to the perceived risks involved. Women either lack collateral or are unwilling to use household assets as collaterals. Many women entrepreneurs experience compliance costs, which include costs related to the time and money involved in learning about and meeting government regulations, and the cost of meeting informal penalty costs from favors requested by government officials. Differential access to credit based on gender differences is debated in the literature on Micro enterprise development, with studies in Canada and Australia discovering little difference between women and men.

Women entrepreneurs often lack information on markets, suppliers, export opportunities, and availability of training programs. This is due to their dual work roles and resulting time constraints. Lack of relevant skills and knowledge compounded by deficiencies in basic education inhibits the growth potential of Micro and Small Enterprises.  

Market saturation is a major problem for Micro and Small Enterprises related to lack of access to higher value markets and lack of innovation. Many women entrepreneurs are located in low value markets where there are few barriers to entry. The sectors tend to be crowded because of these low barriers. This leads to saturated markets and little room for growth.

Finally, women entrepreneurs tend to face constraints resulting from gender roles and responsibilities; occupational segregation; internal constraints; and cultural values. Women’s more demanding role in the family relative to men’s, affect their entrepreneurial ability by reducing the time, energy and concentration levels they can apply to their market work. The amount of time they have available for market work is limited by the time necessary to care for the family. Their concentration while working is reduced by multiple distractions leading to a further reduction in productivity and earnings. Household responsibilities makes them risk averse, while societal perceptions affect their treatment when they step beyond their perceived boundaries, limiting their access to the resources required for successful entrepreneurship.

Traditions pertaining to the type of work that is appropriate for women results in a gendered division of labour in productive work that limits womens’ potential. Activities most readily available to women entrepreneurs are those similar to their domestic tasks. This similarly between the productive and reproductive work makes their productive work undervalued. Cultural values may conflict with women entrepreneurs’ need for freedom of movement and socializing with men. This is clearly observed in several countries around the world where women cannot travel outside their homes or transact businesses without their husbands’ consent.

Integrated Framework for the Development of Women Entrepreneurs in Atlantic Canada

Stevenson and St-Onge in Creating an Entrepreneurial Environment to Foster the Start up and Growth of Women-Owned Enterprises: Best Practice from Atlantic Canada  introduced an integrated approach framework for supporting the start up and growth of women owned enterprises in an underdeveloped region of the Canadian economy during the 1990s. The validity of this framework was reinforced in a ten country study of entrepreneurship policy undertaken in 2000 to 2001 by Stevenson and Lundstrom.

Background of Integrated Approach Framework in Canada

Researchers first started exploring the phenomena of women entrepreneurs in Canada in the late 1970s. At that time, there was very little awareness of the characteristics and behavior of women entrepreneurs and even less knowledge about the nature of their enterprises. In 1977, about one in five enterprises was owned by women, and almost 90 percent of these businesses clustered in retail, trade and services sectors.

Women owned just over seven percent of manufacturing enterprise, largely a male domain. The focus on women in self employment became an issue during the 1970s and

1980s, when in response to changing social and cultural norms (the women’s movement)

and economic imperatives (pressure for dual income earning families), increasing numbers of women entered a labor force where the supply of labor exceeded demand. Unable to find employment, they were forced into a self employed activity. In this domain, they encountered challenges similar to the ones faced by many African women today: stereotypical and negative attitude towards their roles as entrepreneurs, limited access to financing, a paucity of management and business experience, limited access to mainstream business networks, lack of credibility among bankers, suppliers and landlords and often a lack of support from their husbands and family members.

During the 1980s, women entrepreneurs began to form associations and networks while at the same time researchers’ highlighted their needs and challenges making isolated corners of the business support environment to  notice the growing phenomena. The National Film Board of Canada launched the country’s first video documentary on women entrepreneurs in cities across the nation in 1997; several of Canada’s banks started to offer special seminars to attract women entrepreneurs as borrowers; and provincial governments began to explore ways of increasing women owned enterprises as a job creation and rural development strategy.

As mentioned earlier, when women were first identified as a target group in Canadian national Small and Medium Enterprise policy and program support, there was lack of national coordinating mechanism for the implementation of policy and program measures. Consequently, efforts to promote women’s entrepreneurship were largely regionalized. The one piece of national glue was the Business Development Bank of Canada (then the Federal Business Development Bank), who took seriously the challenge of addressing the business development needs of women. The funded research studies sponsored national and regional conferences for women entrepreneurs, and initiated a number of women focused entrepreneurial training programs. They also participated in the joint organization of two national policy forums on women entrepreneurs. As input to these national policy forums, research, discussion papers and inventories of best practice economic support programs for women entrepreneurs were commissioned.