Unleashing female entrepreneurial talent in Saudi Arabia

 

New research reveals that although a small but growing number of women in Saudi Arabia are actively challenging the status quo further regulatory educational and socio-cultural changes are urgently needed to promote women’s entrepreneurship and fully realise the economic and social aspirations of the Kingdom.

Added on 19 April 2013 by Erika Lucas

Middle eastern business woman

New research reveals that although a small but growing number of women in Saudi Arabia are actively challenging the status quo further regulatory educational and socio-cultural changes are urgently needed to promote women’s entrepreneurship and fully realise the economic and social aspirations of the Kingdom.

Although Saudi women are more economically active than often perceived internationally and opportunities for economic participation are increasing the report ‘Giving voice to women entrepreneurs in Saudi Arabia’ confirms women remain vastly under-represented in the vital entrepreneurial sector.

The study carried out by the Women’s Entrepreneurship Initiative a non-profit company that supports women in business in collaboration with Ashridge Business School is the first of its kind in the region to use an action research-based approach. 37 aspiring and established Saudi women entrepreneurs engaged in a series of action research workshops and in-depth interviews.

Kelly Lavelle Founding Director Women’s Entrepreneurship Initiative and report co-author said: “One of the distinctive features of this work is its positive impact on many of the women who participated. The strength of their responses has been the driver to establish the Women’s Entrepreneurship Initiative (WEI) across the Middle East and North Africa region to learn serve and enable change. Now more than ever the world needs to unleash women’s entrepreneurship to further strengthen economies and societies.”

Key Research Findings:

The research suggests women entrepreneurs lack essential competencies and capacities for successful entrepreneurship including:

Self-confidence: Saudi women entrepreneurs can present themselves as confident but often suffer from an underlying lack of self-belief evidenced by hesitation in decision making avoidance of commitment and a strong fear of judgment and failure.

Risk-taking: Female entrepreneurs show courage in following their chosen career path but are however averse to assuming tangible risks e.g. leaving the security and status of government jobs or seeking external funding for their businesses.

Autonomy: A lack of self-reliance self-sufficiency and personal initiative often resulting from social restrictions imposed upon women. This can be internalised to such an extent that they become complacent if not complicit in their situation.

Self esteem: The women interviewed experienced powerful emotional reactions to the gender-specific challenges they face. They express feelings of frustration outrage helplessness and/or self-blame at their lack of autonomy. They also have a powerful fear of judgment and failure.

Current Obstacles

The Saudi Arabian government has committed to ambitious targets to enhance the economic activity of women and the opportunity for women to play a more prominent role in the Saudi economy has never been greater with a comprehensive policy addressing women’s participation in the entrepreneurship sector pending.

However current obstacles in business licensing regulations still include:

Restricted access to government services: Recently established Ladies Sections within government offices are perceived as ineffective women entrepreneurs often prefer to rely on a male relative to help them. Also women continue to encounter a wakeel (legal male representative) requirement when starting their businesses as the enforcement of its removal is not consistent.

Requirement for a ‘mudeer’ (male manager) for public-facing business: Despite its official repeal many women are often still being required to appoint a male manager.

Restricted licensing options: A number of business activities that are popular among women for example home business are not currently available in the official licensing categories.

Lack of support services: More support is needed for the growing needs of working women in infrastructure and support services such as transport and childcare.

Report Recommendations

The researchers make a number of recommendations to help overcome some of the barriers and allow women to play their part in driving positive change:

  • Review and reform women’s education to increase their economic participation. Ensure greater focus on fostering entrepreneurship competencies skills and qualities.
  • Create opportunities for women entrepreneurs to support each other through networking events workshops and change programmes.
  • Address gender-specific challenges in the regulatory environment to improve women’s access to government business licensing services e.g. create a home-business license and ensure enforcement of positive women-targeted policies.
  • Improve women-targeted entrepreneurship initiatives and funding sources. Establish a central information and advisory service and provide training support.
  • Invest in support services and infrastructure such as public-funded transportation services for women and subsidised childcare.
  • Promote awareness of the positive economic role and contribution of Saudi businesswomen.

Dr Hessah Al Sheikh Co-Founding Director Women’s Entrepreneurship Initiative added: “Any procedures designed to address the exclusion of women from the Saudi Arabian economy must address the socio-political and cultural factors that suppress female entrepreneurial spirit and capabilities.”