Rural Women in a Carbon Transition
Rural economies are undergoing significant change as countries seek to meet international climate targets. While this brings new economic opportunities, for example related to renewable energy or forestry, it also brings challenges for those directly or indirectly reliant on carbon-intensive industries.
Scientific research on Just Transitions tends to focus on the impacts of low-carbon transitions on those in traditionally male-dominated professions, especially coal miners or oil workers. Yet, international evidence shows that previous rounds of economic restructuring have produced distinctive new labour markets: places most affected by decline in male-dominated, energy intensive industries have also seen a rise in female employment in flexible service industries. However, these roles are often insecure and low paid. We also know that women are key contributors to the rural economy and their empowerment is crucial to unlocking talent that can help rural communities become more resilient.
Researchers at SRUC's Rural Policy Centre took part in a knowledge exchange network bringing together female researchers, policy makers and community practitioners from across Scotland, Sweden, Norway and Canada to share knowledge about how to best support rural women during the transition to a Net Zero economy in the Arctic region.
Research around rural entrepreneurship is still very much represented by male business owners/operators. Female entrepreneurship is an emerging area of research that is attracting increased policy attention. But this requires further research as neither policy nor current entrepreneurship ecosystems support the circumstances of female entrepreneurs, particularly in rural areas.
Barriers and challenges for female entrepreneurs
One of the main issues is access to financial capital for female entrepreneurs at all stages of firm development. In addition to gender-based discrepancies, women are significantly less likely to apply for all forms of external capital and have indicated limited access to equity financing. Research has shown that female entrepreneurs raise less money, have higher levels of dissatisfaction with their lending experiences and receive loans with less favourable conditions than their male counterparts. Female entrepreneurs access to financial capital is influenced by structural societal and economic norms, for instance due to the 'homophily' of investors - meaning that investors (who are typically male) are more likely to seek out and be attracted to people similar to themselves.
On average, female entrepreneurs have shown a preference for internal and personal sources of financing. Women tend (on average) to have higher levels of risk aversion and a desire to maintain control of the enterprise which can discourage women from borrowing and applying for financing that require the entrepreneur to give away a portion of equity. Additionally, lower levels of financial knowledge and final confidence may discourage women from engaging in fund-raising processes, prevent them from requesting sufficient financial capital, or lead to them accepting less favourable terms for financing.
Additionally, priorities set within the growth oriented economic context may undervalue social enterprises, co-operatives, lifestyle and home-based businesses. There is a need for an 'inclusive ecosystem model' to advance policy and access to financial capital for female entrepreneurs.
These factors can then be exacerbated by the rural context and its associated challenges for entrepreneurial activity.
Case studies: female entrepreneurs promoting a net zero transition
The knowledge exchange network brought together case studies of successful entrepreneurial efforts to promote a net zero transition led by women which drew out themes of:
- collaborative leadership as a unique tool used in supporting women entrepreneurs - for instance, in Scotland Leadership Training courses have been co-designed between the teams at InspirAlba, Art of Hosting practitioners from Connecting Scotland and experienced stewards from Denmark. Training events and follow-up work offer spaces to explore the values of self, nature and shared knowledge of history and community, to work in leadership roles and to collectively address these challenges. The participants developed a deeper understanding of their local issues and learned how to build connections with others to build confidence capacity.
- policy frameworks which support entrepreneurial action - the Scottish Government was going to release a Rural Entrepreneurs Fund for £70 million which included a bottom-up design and supported peer learning. The policy-process can be a very positive element in helping female rural entrepreneurs succeed. The policy framework used to prepare the funding could be something to consider as a positive case study.
- public/ private partnerships which support decarbonisation and green job transitions - in Norway, through public/private partnerships there was successful resistance in preventing new oil exploration to support decarbonisation strategies. While in Sweden, megaprojects in net zero industries such as Northvolt's car battery gigafactory are locating to the Arctic circle. Private industries need help from public ministries to attract domestic and international workers.
- sector-specific initiatives that are female-dominated, for example zero waste and refill grocery shops - in rural Scotland, female entrepreneurial efforts are focused on zero-waste and recycling. Examples include EcoOrkney and EcoSavvy on Arran. Women are more likely to own shops which focus on zero-waste reduction and refilling often because they are the ones more attuned to household waste. In Arctic Finland there is an emergence of immigrant women engaging in entrepreneurial activities with special focus on creative, craft and hospitality-based industries.
Conclusions
This research found that there are both practical and academic knowledge gaps around female entrepreneurship. The scope of this project did not allow for sufficient exploration of these gaps and has set out a proposed future research agenda.
General strategies for prompting entrepreneurship are often not applicable to female entrepreneurs in rural areas because they do not acknowledge, for example, that some businesses are meant to remain micro enterprises, are run from the household and are often part-time activities so therefore will not adhere to the normal growth trajectories.
Digital technologies are seen as helpful for female entrepreneurs in rural areas however they are highly inaccessible for several reasons. When applying to access funding for these technologies, companies use terms like 'diverse' or 'disadvantaged' in their eligibility forms without defining what they mean. Lack of access to technology, and lack of financial literacy can provide barriers particularly for female entrepreneurs.
Read more at our 'Supporting rural women in Arctic low-carbon transitions: a knowledge network" Policy Spotlight below.
