Thank you, Madam Chair.
Good morning everyone and distinguished members. My name is Frances McRae. I am the assistant deputy minister for small business, tourism and marketplace services at the Department of Innovation, Science and Economic Development Canada. The acronym I will be using is ISED.
In French, it is ISDE.
Last February, my predecessor, Ms. Shereen Benzvy Miller, addressed this committee and outlined how ISED is supporting the economic empowerment of women. It is my pleasure to provide an update on ISED's activities since our last appearance.
Canada is a world leader on gender equality, but we do have some challenges on the economic advancement of women, as you well know. I'll talk a bit about our sense of how the situation looks for small and medium-sized enterprises and women entrepreneurs.
I have a few facts to start. Only about 15.7% of small and medium-sized enterprises, SMEs, are majority owned by women in comparison to 64.6% majority owned by men. You may have seen a recent survey of more than 900 Canadian tech firms done by a new company called MoveTheDial and MaRS Discovery District, which found that women “account for just 5 per cent of CEO roles and 13 per cent of executive team positions, while more than half—53 per cent—of tech companies have no female executives. On average, women account for 8 per cent of director roles, while 73 per cent of firms have no women on their boards.”
A study in June 2017, by McKinsey Global Institute, which you're likely familiar with, found that improving women's equality in the workforce by 2026 could increase Canadian GDP by $150 billion.
As you know, the economic empowerment of Canadian women is a key component in Canada's economic prosperity and was highlighted in Budget 2017.
Women's entrepreneurship is increasingly recognized as a key source of employment creation and advancing women's equality. We have found it helpful to think about women in entrepreneurship and women in business as a continuum. They grow and develop along their entrepreneurship journey, from young girls and women needing exposure to entrepreneurship and opportunities in STEM, science, technology, engineering, math, as you well know, through accessing financing, business supports, and mentoring in order to start and grow their businesses. At the other end of the continuum are experienced business owners and leaders who need procurement and export opportunities, leadership advancement, and access to corporate boards.
I'd like to give the committee an update on activities that ISED supports to help women along this journey.
If I go back to the idea of a continuum, the first stage is exposure to entrepreneurship and STEM. For instance, CanCode is investing $50 million over two years starting in 2017-18 to support educational opportunities for coding and digital skills development for Canadian girls and youth.
As I move along the continuum, women benefit greatly from business skills support training. For example, the regional development agencies, which are part of the ISED portfolio, fund entrepreneurship development and women-directed business training across the country.
Women also need financing in order to start and scale-up their businesses. For example, we indicated at our last appearance that the Business Development Bank of Canada had committed to investing $700 million by 2018 in women-owned businesses.
I am pleased to report that BDC has exceeded this commitment. As of September 30, 2017, $809 million had been authorized over 30 months. We surpassed the target of $700 million that the Bank had set. The Bank's portfolio of majority women-owned businesses is now at 4,744 clients, a 41% increase from the start of the initiative.
Announced in November 2016, BDC's women in tech fund extends $50 million in venture and growth capital to women-led tech firms, targeting early-stage and growing companies.
BDC will also deliver a new $400-million venture capital catalyst initiative, which was announced in budget 2017, to provide late-stage venture capital to Canadian entrepreneurs, obviously including women entrepreneurs.
The BDC has partnerships as well. The Women's Enterprise Centre of Manitoba provides loans of up to $150,000, and through a new co-lending agreement signed in June 2017 with the centre, BDC will provide an additional $100,000 to businesses that require more capital.
Finally, BDC has also undertaken a full review of its services to women entrepreneurs. It's expected to release its findings shortly.
As women move along the growth pathway, especially women transitioning to high growth, their needs become more complex. Like all entrepreneurs, they need access to experienced business mentors and targeted supports. I'll give you a couple of examples of how ISED supports organizations that help women-owned businesses grow.
There is Futurpreneur, which offered business training and mandatory mentoring to over 400 young women entrepreneurs last year.
Fierce Founders, a Waterloo-based tech accelerator that is part of an industry-led innovation centre known as Communitech and funded by FedDev Ontario, is designed to provide seed funding and mentorship to women-led businesses. Since the program's launch in 2014, Communitech has seen an increase in women engaging in its start-up services, and now sees 25.9% of its active start-ups with at least one female founder.
For women with mature businesses in the last stages of the continuum—and I'll wrap up shortly on that—we seek to help them export and provide procurement opportunities. For instance, ISED recently launched Innovative Solutions Canada, a new procurement program announced in budget 2017. To maximize inclusiveness, particular effort is going to be made to encourage procurement from under-represented groups, including women.
The government has also taken steps to advance the number of women on boards and in senior management. Bill C-25, which is currently at second reading in the Senate, would require publicly traded companies under the Canada Business Corporations Act to disclose information on the gender diversity of their boards and senior management.
Finally, I will mention an initiative that we anticipate will provide recommendations along the continuum. You will recall that in February 2017, Prime Minister Trudeau and U.S. President Trump announced the creation of the Canada-United States Council for Advancement of Women Entrepreneurs and Business Leaders. The council is focusing on five areas: increasing the number of women in STEM; encouraging women to start businesses; growing women-owned businesses; increasing women's access to capital; and advancing women as leaders in the private sector. These areas align with ISED's priority areas of support for women entrepreneurs, and we anticipate seeing recommendations over the coming months.
To close, Canada is a world leader in gender equality. That said, there is still work to be done.
While the government supports women at various stages along the continuum, we know that we need to continue to do work in this area with other departments and with stakeholders.
Thank you for your attention today.