Advancing Entrepreneurship with Women in Saudi Arabia

Authors

Nandini Hampole

BSR recently met with a number of leading women entrepreneurs in Jeddah as part of a three-part workshop on corporate social responsibility and human rights for Saudi companies, NGOs, and employees of the Jeddah Chamber of Commerce and Industry (JCCI). This meeting was a unique opportunity to better understand developments in the Kingdom regarding women’s participation in the private sector and in the job market.

In recent years, expanded educational opportunities for ambitious young women have increased the share of female entrepreneurs in the Kingdom. Seventy-two percent of registered women owned businesses operate outside the home—making them one of the largest groups in the Middle East and North Africa region according to a recent study undertaken by JCCI and the Monitor Group. In addition, fifty-eight percent of university students in Saudi Arabia are women, and separate retail bank outlets for women have increased their access to financial services. The recently launched U.S.-Saudi Women’s Forum on Social Entrepreneurship provides opportunities for Saudi women to enhance their business and leadership skills. This includes launching CSR ventures which help solve local community and ecological problems.

These opportunities, while encouraging, may overshadow some challenges that remain in fostering female entrepreneurship in the Kingdom:

• Male guardianship
• Limited government assistance: The Saudi government has initiated only a limited number of programs targeting women’s development. Most of the current initiatives receive support from the business and academic communities.
• Lack of business experience: The majority of Saudi women do not work outside of the home, so they often lack business experience and exposure to vital skills that contribute to fueling entrepreneurship.

In a fast transforming era, the Saudi government has started pushing for reforms to bring more women into the workforce—a push that is part of a larger campaign to increase the number of Saudi nationals employed by the private sector. (The current eight percent employment rate of nationals is much lower than the government’s 30 percent target.) The Saudi government has already taken a few steps to address these challenges:

• The Labor Ministry has modified the Labor Law (2008) to make it easier for men and women to interact in a professional and business environment.
• Likewise, women no longer have to get approval from their male guardians to accept or leave jobs.

These encouraging developments open the space further for business to play an important role in fostering women entrepreneurs who in turn will create new jobs for men and women alike. For instance, banks can provide seed funding, create “entrepreneur accounts,” and help raise capital as part of women-specific services they already offer. Likewise, businesses can partner with programs such as the U.S.-Saudi Women’s Forum on Social Entrepreneurship to teach financial literacy, create and build organizations, and be a testing ground for new women entrepreneurs. Ultimately, businesses should be strong advocates by showing women that they too can become entrepreneurs.

With sustained efforts between businesses and government, we will see greater opportunities for women entrepreneurs in the Kingdom in the near future.