Senior Manager responsible for Commercial Enablement at MTN Business, Estelle Jacqueline Asare, has cited the lack of proper corporate governance structures as the bane of many women-owned and women-led businesses.
Speaking as part of a panel at a webinar hosted by the National Board for Small Scale Industries (NBSSI) in commemoration of International Women’s Day 2021, she stated that if women entrepreneurs are to make strides in closing the US$42billion funding gap that exists between men and women in sub-Saharan Africa, they must ensure that their businesses are well-positioned to continue operating even in their absence.
“Most businesses, especially small, women-owned businesses, forget the need for structures and in so doing everything runs around an individual; and this has severe implications for the continuity of a business. If the right governance structures are in place, even a change in headship of the business will not be the end of the business,” she said.
In a similar vein, the Chief Legal Officer at Axis Pensions, Louisa Siaw, argued that there is an ongoing shift in perceptions as women-centric businesses – even those in the lowest echelons of the informal sector – are beginning to demonstrate a higher degree of receptiveness, over their male counterparts, to advice on corporate governance best-practices.
According to her, interactions with women entrepreneurs have shown that they “not only know a lot of these principles and structures that they need to work with in order to make their business grow”, but have displayed willingness to adopt them.
“Most of the time, business owners are focused on breaking-even, profitability, diversity of products, customer acquisition and retention; and they believe that at the end of the day, this is what makes a successful business. However, what we have come to realise is that without those strong corporate governance and legal structures, these businesses will fold-up,” she explained.
She went on to add that owners of small businesses must be made to see that they do not require elaborate documents stipulating their governance structure, but the incorporation of a firm, size-appropriate document is non-negotiable.
“Documents and documentation form an essential part of setting up these structures. The binding document does not have to be wordy; it can be only three-pages long, but must be a working document,” she said.
On her part, Regional Head of Commercial Banking at Ecobank – Charlotte Amanquah, said despite inhibiting factors such as the imbalances in opportunities to scale, access funding and training – as well as the culturally-informed mental blocks set against women entrepreneurs, a good corporate governance structure represents the best opportunity for scaling-up operations for women-led businesses.
This, she said, is important; as it signals to investors and potential partners that the business-owner approaches running the business with an utter sense of seriousness.
“When businesses institute sound corporate governance practices in their nascent stages, the impact is that it becomes easier to work within the structure which has been put in place as they begin to grow. This makes the businesses more appealing to any investor or potential partner, because the leadership thus demonstrates that they take their business seriously.
“When it comes to accountability, being transparent with what I do with my business – as demonstrated by measures such as a succession plan and bookkeeping – is important,” she said.
The webinar was organised by the NBSSI, Ghana Enterprise Agency (GEA) and the Mastercard Foundation Young Africa Works Project under the theme ‘Women in Leadership: Achieving an Equal Future in a COVID-19 World’.