Minority women entrepreneurs start new businesses at four times the rate of non-minority men and women, according to recent research from Babson College. Yet rarely are their stories told and their management practices examined.
It turns out that minority women business owners tend to be more innovative and use their outsider status to develop socially conscious business practices that support the communities with which they identify, according to the researchers, whose work appears in the new book “Minority Women Entrepreneurs: How Outsider Status Can Lead to Better Business Practices.”
“These entrepreneurs reject the idea that business values are separate from personal values and instead balance profits with social good and environmental sustainability,” said Babson College professor Mary Godwyn, co-author of the book.
The book’s other co-author is Donna Stoddard, associate professor of Information Technology Management at Babson in Wellesley, Mass.
This pattern is repeated in statistical evidence from around the globe that women contribute a much higher percentage of their earnings to social good than do men, but until now there was no clear explanation of why.
Using sociological and psychological theories, the authors explain why women, especially minority women, have a tendency to create socially responsible businesses. The innovations provided by the women in this study suggest fresh solutions to economic inequality and humanistic alternatives to exploitative business policies. This is a radically new, socially integrated model that can be used by businesses everywhere, the authors said.