Angela Merkel against quotas for women

To an outsider Germany might seem like a place where women could easily fill high-powered positions, writes Rebeka Shaid. After all, the country is governed by chancellor Angela Merkel, who Forbes recently crowned “the world’s most powerful woman”. Yet last year the German Institute for Economic Research found that over 90 per cent of the nation’s top-100 companies did not appoint one single woman to an executive positions. How can this be?

In 2001, the business community in Germany made a pledge to the government to increase the number of women on boards.  However, almost a decade on, little has changed. The study revealed that only 29 of 906 board seats at Germany’s 200 largest companies were filled by women in 2010 – only a marginal improvement.

Monika Schulz-Strelow, founder and president of FidAR, an association of around 300 members that lobbies for a legal female quota of at least 25 per cent, told me that “the state is bound by the basic German law to enforce gender equality in all areas of society”.

”The proportion of women in leadership positions within companies may be growing slowly, but at this current pace, only a legal minimum quota to get women on boards can speed this process up. This is not a question of the zeitgeist, but a commercial necessity.”

The benefits of women filling executive positions are plentiful, according to Schulz-Strelow.

“Getting more women [on boards] results in better corporate management and improved chances of higher returns. It has been proven that mixed teams do not only increase the economic performance of an enterprise, but also boost its administration.”

Ursula von der Leyen, Germany’s labour minister, who has received advice from Schulz-Strelow on this issue, is likely to agree. Earlier this year, von der Leyen announced her plans to enforce a nationwide female quota by 2013. But even within her own party, this has caused an uproar. Angela Merkel described the extremely low number of women in executive positions – 3.2 per cent in Germany’s largest 200 companies – as a scandal, but does not want to introduce a quota system. Instead, Merkel seeks to put pressure on the private sector to introduce more family-friendly working arrangements. 

Von der Leyen’s proposal to integrate a female quota of at least 25-30 per cent into employment law has not only been disapproved of by the chancellor, but also by some leaders in the industry. One chief executive recently told a German newspaper that a minimum quota was simply “not viable”.

However, Viviane Reding of the European Commission has threatened to impose quotas on the biggest 500 listed groups if companies do not change their diversity regulations by March 2012.

With this deadline looming, Monika Schulz-Strelow says:

“The federal government must recognise that a Europe-wide quota system can only be averted if the cabinet calls for binding reforms from companies directly.”

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