This speech was delivered by Lynne Featherstone on 22 June 2012.
Subject to delivery
As you may know, before I became a politician, I was once one of you - I was a graphic designer for twenty years and ran my own design company.
So I recognise both the challenges and rewards of being a small business owner.
I’m sure you all know what I am talking about - filling in tax and VAT returns, recruiting, and trying to grow your business on top of all of this!
What you and I understand is how fundamental the role of small business is in powering job creation and economic growth in this country.
And how important it is to harness women’s skills and experience in small business.
Women and business
So why is it so important for women to be involved in business?
We know that:
- if the UK had the same level of female entrepreneurship as the US, there would be approximately 600,000 extra women-owned businesses, adding an extra £42 billion to the economy;
- if women started businesses at the same rate as men, there would be an additional 150,000 extra start-ups each year in the UK.
We know that, despite great progress in recent decades, women are still more likely than men to be in low paying jobs.
They are under-represented in senior positions.
Women are about half as likely as men to be engaged in entrepreneurial activity.
This untapped potential needs to be unleashed if we are to achieve the economic growth we need.
What is the Government doing to make this happen?
Mentoring and rural growth
We are funding the recruitment and training of 15,000 business mentors. Over 12,000 volunteers have already signed up to get mentoring and over 7,000 have been trained, 40% of whom are women.
We are also providing £2million over the next three years to support women setting up or expanding their businesses in rural areas.
Women’s business council
We have set up a women’s business council. The council chair, Ruby McGregor -Smith, CEO of MITIE, and the nine council members have been chosen for their achievements in business sectors as diverse as advertising, social media and retail.
They will use the skills and experience they have gained in their businesses to look at ways of maximising women’s contribution to economic growth.
The Council met for the first time this May and will come back to us with specific recommendations by May 2013.
They will be publishing their work programme shortly.
I am so pleased that your own chief executive, Louise Punter, has agreed to add her considerable talents to the expert group working with the women’s business council.
The expert group will act partly as a communication channel to connect the council with women like you.
Think, act, report
We have proof in this room today that British business is good for women. And we know that women can thrive in both large and small companies.
Women’s employment prospects in this country have transformed significantly over the last 40 years.
There are now almost as many women in employment as men, and more of those women than ever before are in senior positions.
But it frustrates me that, despite action by governments over those 40 years, women are still paid, on average, only 80% as much as men.
The causes of this are complex.
Research shows that women often go into different careers from men;
They take different paths within those careers;
And they are more likely to take career breaks, which have a knock-on effect for their earning potential over the rest of their careers.
There is no magic bullet to solve the issue of gender inequality in the workplace. But we believe that business itself should take the lead in addressing this.
In these tough times, our most successful companies understand that they can’t afford to ignore the skills and talent of half the population.
They want to do better for their staff - and for themselves.
And I firmly believe that for most companies who are trying to do the right thing, voluntary business-led initiatives are key.
They secure more buy-in and achieve more lasting change than the big stick of legislation.
Over the last year, we have been working with some of the top firms in the UK - like Tesco, BT and National Grid. They have taken the lead on tackling the barriers for women in the workplace.
Together we have developed a simple, voluntary, step-by-step approach called think, act, report.
It encourages both large and small firms to take action, where action is needed, to promote gender equality.
And - crucially - to share their experiences, publish their progress and report their good practice.
It is not about forcing companies to report information they don’t want to. It is about helping to drive a change of culture.
Think, act, report has been designed so that each firm is able to decide what measures are relevant to them.
Last week I spoke at a roundtable for business hosted by Nomura, the investment bank.
We heard about the excellent work that Nomura are doing.
Ensuring more women who want to, return to work after maternity leave.
And enabling women to gain relevant board-level experience in other organisations - often in the voluntary sector.
For those of you that have not yet taken up the initiative I would urge you to do so. And you can find all the detail son the home office website.
Lastly, I want to talk to you about small business and red tape.
Red tape challenge
Over the last year, we have been listening to business about unnecessary burdens in equalities legislation.
It was part of the red tape challenge review to reduce red tape on businesses - particularly small business.
As a result, we are currently consulting on scrapping a number of specific measures.
They include forms for potential claimants to obtain information from employers and wider recommendation powers for tribunals.
I hope you will have a quick look at the consultations on the home office website and respond in the next few weeks - we need you to let us know if we’re on the right track.
Equality act compliance
Reducing the regulatory impact on small business isn’t just about cutting red tape - it is also making sure the legal framework in place isn’t over implemented through worry or ignorance.
Our feedback from small business says many firms are spending more money and time than they can afford in setting up diversity processes.
These processes seem, at best, an attempt to try and protect their business from the cost and resource shock caused an employment tribunal, and, at worst, a tick box exercise.
But what this culture of over compliance doesn’t seem to do very well is actually make that company a fairer or better place to work.
Small business owners have told us they are looking for something that will help them manage their businesses and staff effectively.
They want simple, accurate guidance that sets out their minimum obligations under the law.
Working with business, we will promote a better understanding of what the legislation requires small businesses to do and develop effective business friendly support and guidance.
We have already made a start on this.
In the light of red tape challenge, we have identified age, maternity and disability as areas which impact on small businesses at times of high risk for business continuity.
Especially when you are hiring new staff and managing long term staff absence.
We have taken one particular difficult issue - the questions you can and can’t ask about health and disability when recruiting staff - and cut the employers’ guidance down to two pages of essentials.
You can find this new guidance on the home office website.
Over the next few months we will be giving the same treatment to other equality issues small businesses find problematic.
To promote this process, my ministerial colleagues and I will be talking with small businesses, including women business owners.
Later this year, we will be involved in a national programme of small business events produced in partnership with the british chamber of commerce.
I look forward to this engagement and I hope you will support our work with business to simplify equality act compliance.