Commercial Finance News:-Major lenders are signing up to a new code for investing in women to help increase the number of female entrepreneurs by 600,000 within the next ten years.
The Treasury announced the code following the publication of the Rose Review released on March 8 to coincide with international women’s day. So far key lenders including Lloyds, Royal Bank of Scotland, the UK Business Angels Association and UK Finance have signed up.
Prime Minister Theresa May said: “I am committed to real change in this area, starting with our action today to encourage more companies to look at the gender split of who they choose to invest in.”
The review found only one in three UK entrepreneurs were female – a gender gap equivalent to 1.1 million missing businesses. Up to £250 billion could be brought to the UK economy if women started and scaled up new businesses at the same rate as men.
Deputy chief executive officer of NatWest, Alison Rose, who headed the review, said she was passionate about redressing the imbalance.
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“The UK has one of the most vibrant entrepreneurial communities in the world, but only one in three of our entrepreneurs is female – we need to be more ambitious and find ways to unlock the huge untapped potential.”
The report found women-led businesses were less than half the size of male-led businesses and that the latter were five times more likely to scale up to £1million turnover than female-owned SMEs.
She added: “Some of the findings are stark but by shining a spotlight on the issues and outlining the barriers and opportunities, the aim is to support the full potential of every woman who has the entrepreneurial spirit and ambition to start or scale their business.”
The review wants more funding directed to women, greater family support, accessible mentors and networks available. The UK trails behind other developed countries with only 6 per cent of women running their own businesses compared with 15 per cent in Canada and nearly 11 per cent in the US.
Venture capitalist imbalance of the sexes
Rose said perceived bias within the UK venture finance community was a concern as only 13 per cent of senior UK investment teams were female and almost half had no women at all.
“Less than 1 per cent of UK venture funding goes to all-female teams and just 4 per cent of deals. This is a complex issue, but not one that we should skirt as it is frequently mentioned by female entrepreneurs who feel they are judged to be less competent than their male peers.”
SME lender Henry Howard Finance’s chief operating officer Anne Williams agreed there should be more women in senior lending positions.
“The trend for females occupying financial services roles is changing, and along with it the stereotype of finance being a male-dominated industry, but it’s not changing quickly enough.”
In the last year the company has appointed more than ten women into senior roles including group financial controller and head of business partnering. The company employs 130 people throughout the UK offers finance packages to small and large companies.
Alternative commercial finance lenders stress the business case of a new project is key for securing funding and women are viewed just as favourably as men.