June 16, 2019

The ‘Sara Kirke’ Declaration for Diversity & Women-led Enterprises (open draft for consultation)

Lady Sara Kirke (1660)

The above letter written by Lady Sara Kirke to the King of England and was a request for one of her son’s to be given all the titles and recognition that had been enjoyed by her late husband. The appeal was unsuccessful so Lady Kirke simply carried on successfully managing her husband’s many business interests. 

Sara Kirke is considered by many to be North America’s first entrepreneur. Sara Kirke arrived in Newfoundland in 1638 with her husband David Kirke, who was soon recalled to England. Sara, however, continued to reside in Avalon, and conducted business as usual from the Pool Plantation. After the death of her husband she assumed full responsibilities for the family business.

Lady Kirke was a remarkable individual as she managed affairs at the Pool Plantation for 30 years and became one of the most successful merchants on the English Shore — and was almost certainly North America’s first and foremost woman entrepreneur.

Read More on Sara Kirke in this study by Robert W. Sexty, Faculty of Business Administration and Suzanne Sexty, Queen Elizabeth II Library, Memorial University of Newfoundland.

The’ Sara Kirke’ Declaration

The ‘Sara Kirke’ Declaration outlines five modern day guiding principles that if adopted, will help promote and accelerate diversity and the growth of women-led enterprises in Canada.

These five principles were derived from consultations with past Sara Kirke Award winnerssenior men and women, leading both public and private organizations from coast to coast, available research studies and advice from public policy groups, as well as from CATA Board Advisors and members.

Our goal is to establish a best practices model for governments and industries of all sizes, and across all sectors both today and tomorrow. Entering the age of Industry 4.0 will require bolder steps and more courage, as a more diversified workforce is not only good for business, it is imperative that advancing Artificial Intelligence, Advanced Robotics that our future world be designed without bias.

We believe these five principles, when combined with data-driven decision making, will significantly help reverse many lagging trends and patterns that are negatively impacting the Canadian economy.

      1. Secure a 40-50 percent Representation of Women on Boards of Directors in Public & Private Sector Organizations

Having more gender and racial diversity in the boardroom is positive for business.

Studies show that the presence of women in the C-suite improves performance, and that among profitable companies, a move from no women leaders to 30 percent representation is associated with a 15 percent profit boost as well as an increase in market valuations.

Some European countries, including Germany, Sweden, Iceland, Finland, and France, have quotas and fines requiring to add women to their boards. Norway in 2008 required companies listed there to give at least 40 percent of their director seats to women. 

The State of California in late 2019 signed California Senate Bill 826, which requires publicly held companies based in California to have a minimum of one woman on their boards of directors by the end of 2019. From there, women’s representation will have to increase: By the end of July 2021, companies have to have at least two women on boards of five members and at least three women on boards with six or more.Companies that don’t comply will be fined $100,000; subsequent violations will draw a $300,000 fine.

A similar model should be developed, refined and adopted in Canada. We don’t need any more studies. We don’t need to keep being polite and nice. We need to modernize our business world to advance our economy. More women in business is simply smart business. 

     2.  Move Beyond Talking About Women In STEM and accelerate Attracting, Developing and Retaining Women in STEM

While nearly 60 percent of university graduates in Canada are female, less than 40 per cent of those women graduate with math and science degrees.

Only 22 percent of all Canadians working in STEM (science, technology, engineering and math) are women.

Having STEM skill sets provides access to higher salaried positions, more financial independence, the ability to influence the direction of new projects and recognized as a leader. 

In order to develop the STEM pipeline for women in our ICT Sector, we must not only support effective interventions to advance women in science, technology engineering, and math but also develop innovative pathways for women from other disciplines to expand careers into STEM, and be ready for new jobs such as: Digital Curologist, Analytics Designer, Ethics AI Officers, Data Scientist, etc.

Overall, there are very few senior female role models in STEM business, and a lack of access to sponsorships and peer networks. CATAAlliance has been building an inventory of role models in STEM and their mentoring videos can be found here at the ‘Sara Kirke’ Channel for Mentorship, Career Advancement & Diversity.

   3. Removal of the 51 Percent Cut Off Limit to Access Growth Resources for Women-led enterprises

Government policy places an emphasis on “women owned” business, defined as 51% equity in the company, rather than on women-led or women-founded companies and how this guidance affects access to growth capital and related resources.

In the early stages of setting up a company, a 51 percent rule makes some sense. However, scalable company owners are often in the position where they have to seek equity-based investment to get the capital needed for rapid growth. Given that there are proportionally few women investors in the market (estimated at about 14 percent of the total), this places women-led and founded companies at a disadvantage to access resources to enable growth needs, capital, talent acquisition, etc.

The unintended result reduces the capital supply pool and resources available to women led businesses or to forces owners to opt to dilute their company and thus loose their status for extra consideration for contracts and export opportunities.

We must avoid creating legislative brick walls that set up unconditional ownership and control of 51 percent, a barrier exacerbated by the skewed high ratio of men leading venture and angel investing.

This artificial barrier reduces resources available to women-led business and it should be removed. A potential solution would be to limit the 51 percent requirement to the equity structure after excluding investors.

    4. Removal of the Crowdfunding Barrier Limiting Startup and Growth Capital

Linked to Principle 3, entrepreneurs, whether male or female, are generally underfunded and limited by select crowdfunding barriers.

The majority of Canadians are legally barred from investing in private companies, by legislation called National Instrument 106-45 —Prospectus Exemption. The document states that in order to be an “accredited investor”, an individual must earn a yearly income of $200,000, own financial assets worth at least $1 million, or own total assets of at least $5,000,000. Anyone who doesn’t meet one of these thresholds is disallowed from investing in private companies.

The law creates a two-tiered system of financial freedom, where those who meet the financial requirements can profit off early-stage companies, and those who don’t can’t.

But there’s demand to invest coming from retail investors: Crowdfunding is a $5 billion industry in Canada, and enabling them to invest directly can only grow the pipeline of funding for women led enterprises. This barrier should be removed to accelerate crowdfunding for startups.

This crowdfunding rethink is needed to help increase flow considerations, for both men and women to increase their entrepreneurial choices.

     5. Women Friendly Social Net Policies & Career Mentorship

Private sector industry must develop and commit to policies and practices that assist women to advance.

The Federal Government invests hundred of millions into venture capital funds, angel funds, with limited focus on equitable allocations to women. 

Friendlier social policies for women also need reviews to include:  affordable childcare, educational programs aimed at all school levels, work sharing, portable benefits, taxable expenses associated with childcare, and career mentorship.

SUMMARY

For Canada to be successful in the Industry 4.0 economy, and to move from mediocre grades in innovation and commercialization, we must address each of these five shortcomings.

True guiding principles need not be viewed as gender specific. Rather these principles focus on encouraging inclusion of all, self awareness – particularly for dominant groups (sometimes gender and sometimes not), emotional intelligence and the behaviours that make an organizations successful.

Increasing equitable entrepreneurial forces in order to attract, develop and retain more women in STEM is an economic imperative.

To create Sara Kirke inspired women to become entrepreneurs, the private sector and government have a responsibility to declare that we don’t need more research, we need to dig deep and advance new legislative changes, modernize our practices, and hold our leadership teams, and board of directors accountable.

Your daughters and granddaughters are depending on our leadership. They deserve a better social and economic system where diversity is not just given lip service, rather it is authentic, kind, and equitable. 

 

We now reach out to harness the power of all Canadians in a call to young and old in all walks of life to support the ‘Sara Kirke’ Declaration, as we together address difficult challenges of achieving diversity and the growth of women-led businesses.

Interested in being part of the ‘Sara Kirke’ Video Channel or writing an Op-Ed?  then please confirm your interest to adebroy@cata.ca