Indicator EC.3.d Minority and women owned businesses


Descriptive Title: Minority and women owned Local Business Enterprises

Why Is This An Indicator Of Health and Sustainability?

Throughout history, discrimination against women and people of color has impacted their job and educational opportunities, career advancement, income and earning potential and many other factors that impact their health and economic well-being.  The promotion of minority owned and women owned businesses in government contracting processes can help address past discrimination and current issues of equity.    Studies have found that minority businesses are more likely to hire minority employeesa and contribute more total dollars to charitable organizations than non-minority owned firms.b   Local establishments help individuals gain equity through ownership.  They also generate job opportunities for residents and recycle a larger share of their revenue back into the community.c 


In order to qualify as an LBE, a business must meet the following requirements:

  1. An establishment’s primary place of business must be located in San Francisco where all services for which LBE certification is sought are conducted on a regular basis.
  2. The business must continuously operate in San Francisco and possess a current San Francisco Businesses License for at least six months prior to the time of certification.
  3. The business must demonstrate that the majority of its principles are based in its San Francisco office.
  4. The majority of the business’s employees must be based in its San Francisco office.
  5. The business must perform a commercially useful function.
  6. Businesses must not exceed maximum economic thresholds.

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Woman-Owned and Minority-Owned Designation: Micro-, Small- and SBA-LBEs with either woman or ethnic minority ownership greater than or equal to 51% will be designated as being a "Woman-Owned" (WBE) or "Minority-Owned" (MBE) business in their certification letter. The woman or minority owner(s) must be the license qualifier(s) and/or possess the credentials required for the category for which they seek certification…. 

The following constitute ethnic minorities with respect to LBE certification: (i) African Americans, defined as persons whose ancestry is from any of the Black racial groups of Africa or the Caribbean; (ii) Arab Americans, defined as persons whose ancestry is from an Arabic speaking country that is a current or former member of the League of Arab States; (iii) Asian Americans, defined as persons with Chinese, Japanese, Korean, Pacific Islander, Samoan, Filipino, Asian Indian, and Southeast Asian ancestry; (iv) Iranian Americans, defined as persons whose ancestry is from the country of Iran; (v) Latino Americans, defined as persons with Mexican, Puerto Rican, Cuban, Central American or South American ancestry; and (vi) Native Americans, defined as any person whose ancestry is from any of the original peoples of North America, and who maintains cultural identification through tribal  affiliation or community recognition.


Although the designation of a business as woman-owned or minority-owned is intended to prohibit discrimination in the awarding of public contracts, this designation does not necessarily incentivize the hiring of women-owned or minority-owned businesses unless explicitly stated as such in the request for bids/proposals.  Additionally, the designation of woman-owned business or minority-owned business is only applicable for businesses that may be hired through city contracts – for example contractors and construction suppliers; and does not apply to all businesses.  Many businesses that may be majority woman-owned and/or minority-owned – for example beauty salons, restaurants, or car washes – are not eligible for local business enterprise certification.  The list of goods and services eligible for LBE certification are available here: 

The location of certified women-owned or minority-owned businesses should not serve as a proxy for the location of all women-owned or minority-owned businesses in San Francisco. Various factors may affect whether a business owner seeks certification from the city, including knowledge about the program and understanding of the city contract process, language and literacy barriers, availability of human resources support/staffing to apply for the designation, the perceived benefits of the program compared to perceived costs for submitting application, social networks that may encourage or discourage participation, the amount of time/availability to apply, etc.