Treasury to introduce code to boost female entrepreneurship
The Treasury has signalled it plans to increase the number of female entrepreneurs in the UK by 50% by asking lenders for details of the gender split of business investments, after research found women face too many barriers to setting up a business
11 Mar 2019
An independent review – commissioned by the Treasury and headed up by Alison Rose, deputy CEO of NatWest – revealed that only one in three entrepreneurs are women, a gender gap equivalent to over one million fewer female entrepreneurs in the UK.
Businesses that are run by women are on average half the size of male-led firms and far less likely to scale up to a £1m turnover. The Rose Review said closing this gap between women and men could add an additional £250bn in gross value added (GVA) to the UK economy, equivalent to four years of economic growth.
The report’s recommendations included greater transparency in funding given to women-run businesses by investors, and more courses teaching entrepreneurship in schools and colleges.
The government has responded with the creation of a new Code for Investing in Women that will see banks and other financial institutions publish the gender split of the investments they make, showing if businesses are either male or female-led.
The Treasury says the move will encourage financial institutions to adopt a set of best practices that will benefit female business owners across the country. Lloyds, UK Finance and UK Business Angels Association have already committed in principle to the code.
Robert Jenrick, exchequer secretary to the Treasury, said: ‘Today’s businesswomen face too many barriers to setting up and scaling their enterprises. This doesn’t just hold back women, but every single one of us.
‘That’s why we will be implementing Alison’s recommendation for a new code for banks and investors to give businesswomen greater access to finance, as part of our ambition to increase the number of female entrepreneurs by 50% over the next ten years.’
Increasing the number of female entrepreneurs by around 600,000 by 2030 would bring the UK in line with other major economies such as France, Canada and the US for gender equality.
The Treasury has announced a number of other initiatives designed to encourage female entrepreneurs, including improvements in online advice for all aspiring entrepreneurs and businesses; support for industry-led initiatives to set up a female-focused investment fund and a task force to drive more funding to female entrepreneurs; and backing for efforts to increase local businesses mentors for women and promote entrepreneurship among 15-18-year-old girls in schools.
Report by Pat Sweet