Here’s How Indian Women Entrepreneurs Can Have Level Playing Field

What are the barriers Indian women face when it comes to entrepreneurship and how can they be overcome?

Illustration of ‘boss lady’ Indra Nooyi, former CEO of PepsiCo, used for representational purposes.

(Photo: Shruti Mathur/The Quint) 

Arundhati Bhattacharya, the former SBI Chairperson and presently Chairperson of the board of SWIFT India, has bemoaned the fact that women suffer from two major handicaps in their endeavour to becoming entrepreneurs – the inability to raise equity, and the inability to offer collaterals for loans. She then went on to say only about 19 percent of entrepreneurs in India were women, out of which many were ‘figure heads’, and it was actually the men who were driving from ‘behind’.

What she said is uncomfortably true, though some might shrug off the state of affairs as not being unique to India. Many countries are indeed muscularly patriarchal. Nordic nations have however bucked the trend. In Norway for example, 40 percent of directors are mandated to be women, which in turn has strengthened their hands like nothing else before.

How Patriarchy Discourages Women Entrepreneurs

A big part of Indian culture, like most other cultures, has been patriarchal, starting with the family structure. Kerala, despite its matrilineal property laws, has only done so much to buck the trend in India. Goa has been practicing joint property law – husband and wife own half each. Of course, neither of these states has thrown up successful women entrepreneurs in droves, but the point is, even property laws and political discourse can go a long way in levelling the playing field.

What Bhattacharya said about women being driven from ‘behind’ (in the board of directors) has resonance in our political firmament too. It is no secret that even women sarpanchs have to comply with patriarchal and often misogynistic husbands.

But then again, women like Kiran Mazumdar Shaw, the feisty Biocon founder have shown the way and inspired other women entrepreneurs.

Therefore, Bhattacharya is not exactly right when she says that women are unable to raise equity. Venture capitalists or angel investors usually do not discriminate between men and women. They are mostly driven by potential.

Yes, the odds are stacked against women when it comes to offering credible collaterals, as men – by ‘virtue’ of being men – get to hog all the properties. But more ‘enlightened’ states have made property registration in the name of women an attractive prospect by offering a lower rate of stamp duty if the transferee is a woman, as well as by charging lesser property tax for properties owned by women. The lasting solution however, remains in following the Goan model – upon marriage, the spouses divvy the property between themselves equally. That lends strength to the marriage as divorce proves to be very costly for the one who wants to quit wedlock.

Breaking the Glass Ceiling

Bharatiya Mahila Bank, which was launched with much fanfare in 2013, was the most short-lived bank. It became defunct in 2017. Apparently its substratum was lost, its objective was not being achieved with women borrowers ‘being very few’. So is it that women in general are chary of business?

Arundhati Bhattacharya is thus, not off the mark when she says that (the highest) success has eluded women in business. She is also on dot when she says women tend to be more conscientious and repay their borrowings sincerely which is why most of the micro finance companies prefer to seek out the matriarchs of families. But then, it is not all gloom and doom. The glass ceiling has been and is continuing to be shattered by the likes of Indra Nooyi, former CEO of PepsiCo. As more women are afforded access to education and other rights, more women entrepreneurs will hopefully emerge.

Pro-women property laws would help, as would family and institutional support. 

India is the first developing country to have enforced a quota for mandating listed companies to have at least one women director on the board.

Also, the female representation on boards in the NIFTY 500 has increased from 5 percent in 2012 to 13 percent in 2017.

These are some findings of a report by Ernst & Young. But one woman director is tokenism at best, when compared with 40 percent in Norway. Be that as it may, the presence of women in the boardrooms is said to have fostered more seriousness in deliberations, with directors shaking off the clubby approach that hitherto marked the boardroom conviviality bordering on superficial discussion.

(S. Murlidharan is a Chartered Account, and has also written extensively for The Hindu Business Line between 1996 through 2013, and later started contributing regularly to Firstpost on a range of issues like business, economic, tax. He is currently based in Chennai. This is an opinion piece and the views expressed above are the author’s own. The Quint neither endorses nor is responsible for the same.)