Indices Examine Conditions, Top Places for High-Potential Female Entrepreneurship

Two recently released indices assess countries and cities on the characteristics that enable female entrepreneurship. The 2015 Female Entrepreneurship Index finds the U.S., Australia, the U.K., Denmark and the Netherlands offer the world’s most attractive environments for high-potential female entrepreneurship. Meanwhile, the Dell Women Entrepreneur Cities Index ranks New York City, California’s Bay Area, London, Stockholm and Singapore as the top cities for female entrepreneurship. These indices may be useful to policymakers who are limited in their knowledge of the conditions that enable entrepreneurship, especially among females and other underrepresented communities.

New research from Siri Terjesen of American University seeks to synthesize the growing body of research on female entrepreneurship to build an index that allows for an increased understanding of the individual and institutional factors that influence high-potential female entrepreneurship. The goal of this tool, according to Terjesen, is to help policymakers assess the strengths and weaknesses of their entrepreneurial environment as it pertains to gender.

The 2015 Female Entrepreneurship Index covers 77 countries and includes 33 factors across 15 pillars, each rolling into three sub-indices: entrepreneurial environment, entrepreneurial ecosystem, and entrepreneurial aspirations.

Although each country has its own unique set of strengths and challenges, based on this index Terjesen finds that the U.S., Australia, the U.K., Denmark, and the Netherlands offered the five most attractive environments for high-potential female entrepreneurship in the world.

While Terjesen’s Female Entrepreneurship Index describes conditions for high-potential female entrepreneurship at the national level, a recently released study from Dell views female entrepreneurship through the lens of global cities.  The Dell Women Entrepreneur Cities Index (WE Cities) uses the city-lens to identify the impact of local policies and programs, in addition to national laws and customs, according to a press release.

Conducted by IHS, a private business analytics firm, five broad categories of city characteristics contribute to the WE Cities index: capital, technology, talent, culture, and markets. Overall, the index contains 70 indicators, 55 of which have a gender-based component. Indicators are weighted on four criteria: relevance, quality of underlying data, uniqueness in the index and gender component.

Based on overall rankings, the top five cities for female entrepreneurship according to the WE Cities index are: New York City, California’s Bay Area, London, Stockholm, and Singapore. The results of the WE Cities report were influenced by the April 2016 Dell Women’s Entrepreneur Network Research Symposium.

Ultimately, the world has much to gain from increasing the role that females play in the global economy, especially through entrepreneurship. A September 2015 McKinsey Global Institute report finds that, if all countries matched the rate of improvement of the fastest-improving country in their region in progress toward gender parity, global GDP could grow by as much as $12 trillion by 2025, an increase of 11 percent. The authors of the report note that providing skills and leadership training for female entrepreneurs is a promising area in an effort to create economic opportunity on a global scale.