This research theme attempts to increase the participation rates of under-represented groups in enterprise and to increase the growth rates and ambitions of their entrepreneurial ventures have to date resulted in only modest changes.
Why is this? The research explores the drivers and barriers to business development and growth among diverse social groups with a focus on the inter-relationship between individuals’ entrepreneurial decision making and their household context. The WP draws on the innovative Enterprise Diversity Alliance (EDA) to develop productive relationships between the finance sector and businesses from under-represented groups, and enhance the support available for such enterprises.
Initial work on this theme has focussed primarily on a review of existing research relating to diverse enterprises and an analysis of existing data sources related to diverse enterprises and more specifically the SME Finance Monitor.
Women-led businesses perceive higher financial barriers, start with lower capitalisation, may have stronger debt aversion and are more likely to be discouraged borrowers. No evidence of supply side discrimination. Sectoral and management challenges also exist for women-led businesses. 
Household level influences have received limited attention in entrepreneurship and SME research. Insights from sociology and anthropology are potentially valuable.
Social context is an important driver of entrepreneurship amongst minority groups; entrepreneurship in turn can be a significant driver of socio-economic advancement.
Borrowers can be divided into six distinct groups: existing borrowers; new and renewed borrowers and declined borrowers (Expressed Demand); unfulfilled borrowers (Unfulfilled Demand); discouraged borrowers; and indifferent non-borrowers (Latent Demand).
Differences in finance outcomes are largely, but not entirely, a consequence of underlying structural factors that lead women-owned and ethnic minority businesses (EMB) businesses to present a particular set of characteristics. Coupled with the marked gender and ethnic dimension to financial track records which inform risk ratings, these structural effects influence finance outcomes for many diverse enterprises.
Prof Sara Carter continues her engagement with the development of the policy framework for women’s enterprise for Scotland. This led to a draft framework “Women in Enterprise”, co-authored by Sara Carter which was launched by Scottish Government Minister Angela Constance at the Women’s Business and Enterprise Conference in Glasgow on 9th May 2013. The framework is available at: http://www.wescotland.co.uk/launch-of-the-scottish-framework-for-womens-enterprise. Subsequent meetings to discuss implementation have been held with John Swinney, SE, HIE and Business Gateway. The recommendations are similar to those highlighted by the Women’s Business Council report and produced by the UK Government Equalities Office, who are in regular contact with Sara Carter.
EMB and the EDA
ERC engagement with EMB businesses has largely been through the EDA which has held various events during 2013. On 21st March 2103 in Birmingham, Putting Diversity & Enterprise on the Map, which informed attendees about: new research initiatives to support small firms; the EDA’s work with minority business communities; and how they can get involved with the EDA and ERC. A similar event was held in Glasgow on 2nd May 2013 to introduce participants to the EDA and the ERC and discuss possibilities of launching an EDA in Scotland. As a consequence of the EDA’s outreach activities, Kiran Trehan was invited to join the Evidence and Data Task and Finish group by the Enterprise Directorate Department for Business Innovation and Skills and the Mentorsme Enterprise Mentoring Advisory Council (EMAC),. On 23rd July 2013, the LEP network published an article about the work of the EDA: http://lepnetwork.org.uk/enterprise-and-diversity-alliance-make-offer-to-leps.html
Entrepreneurship as Ethnic Minority Liberation (Research Paper No 11)
This paper explores to what extent ethnic minority entrepreneurship promote socio-economic advancement?
Entrepreneurial Families and Households (Research Paper No 10)
The paper explores the relationship between the household and the enterprise and how families and households interact with and influence business decisions.
Diversity and SMEs (White Paper No 3)
This paper explores the existing evidence, complexity and policy tensions that exists for diverse groups operating SMEs in the UK.