Eddielogic

– Thoughts on Strategy and Management

Women’s quota for Management Boards

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In Germany there is a political discussion going on about women’s quota for positions in management boards and top management. This is a political discussion and mainly refers to large businesses, i.e. for DAX-companies, for the time being. Currently, political parties and even ministers have varying opinions about this topic. Ideas range from critical positions to voluntary commitments or legally enforced quotas. The result of this discussion is still completely open. However, some companies already prepare for this new requirement. For instance, Deutsche Telekom announced a 30 % women’s quota in March 2010.

Women’s quotas are mainly discussed in the context of necessary changes in the way business is done. Women are said to have a different management style and hence, a higher proportion of women in top management would change management culture. This idea became even higher priority with the current financial crisis, which is partly attributed to greedy (male) managers.
I will not discuss here my personal opinion about the chances for better management decisions due to a higher number of female managers. Neither will I elaborate about my opinion as a woman on the question if all these initiatives are what women need for their careers. Nevertheless, women’s quotas are related to questions of corporate government, regulation and sustainability and thus are part of some important megatrends. Hence, businesses are well advised to think about this seriously.

The first question of course is to decide whether this trend is relevant for a particular business. As far as political regulation is concerned, this may depend on the country and the size or legal form of the corporation. But even if there is no legislation pending on this, public opinion could still force businesses to deal with women’s quotas. It is advisable to do a careful stakeholder analysis on the intentions and power of stakeholder groups that may have an impact here. Such are press and media, trade unions, lobby groups and other special interest groups.
If the proportion of women in top management seems to become relevant for a business in future, some more questions arise:

  • If a business needs more female managers – where would they come from?
  • Is there enough female talent around? What is the proportion of women in the industry and in relevant study courses?
  • What is the typical career path of women in that industry? To what level of management do they normally get? Why do most women not reach higher management levels? Do they want to advance further in their careers at all?
  • Are there other female talent pools, i.e. other countries or industries?
  • How could it be made easier for women to reach top management? I think the typical mentoring programmes and dedicated training courses will not be enough. Rather, questions of work-life-balance and reconciling work and family life need to be addressed.
  • What if all efforts to attract a sufficient number of sufficiently qualified women fail?
  • And last but not least: What do you do with all the men who aspire to a management position that is now dedicated to women? Over the last decades it has already become much harder to get a position in higher management due to strategies of lean management and flat hierarchies. Women’s quota initiatives will invite even more participants to the race for an unchanged number of positions.
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