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Survey on gender quota for supervisory boards

Abstract

As from 2016, the statutory gender quota of 30 per cent for supervisory boards of listed and codetermined companies came into effect. Manuela Schwesig, Federal Minister for Family Affairs, Senior Citizens, Women and Youth, said in December 2014: "The gender quota will bring fundamental improvements to the corporate culture in Germany. More diversity within companies also promotes their performance and success. For years, there have been enough qualified women in the market. Companies will therefore have no problems in complying with the gender quota and achieving their own ambitious goals."

Hengeler Mueller partner Daniela Favoccia and top executive search consultant Heiner Thorborg, together with the German customer institute (DKI), surveyed supervisory board members on the changes and their work within their board before the quota came into effect. Pleasingly many supervisory board members answered and the results are conclusive. The majority of the respondents in fact believe that the gender quota will make it more difficult to find qualified candidates in the future. While most men clearly do not expect the work in gender quota compliant supervisory boards to improve, a large number of female supervisory board members do indeed believe it will. Anyhow, the majority at least expects the discussion culture to improve. Taking into account the increasing complexity of business and legal risks, companies more and more strongly depend on an efficient supervisory board. The present survey provides a snapshot shortly before the quota came into effect. Pleasingly it shows that at least the supervisory board members themselves believe the efficiency of their individual boards to be positive. Even if both women and men feel very well established among their colleagues: men do not believe in a higher performance of boards with a higher number of women and only the future will tell whether this perception might change.

Summary of the results

Male supervisory board members are not convinced of the necessity of the quota. However, the majority of the supervisory board members want to actively support the promotion of women.

  • Regarding the evaluation of the gender quota introduced by the legislator, the respondents are divided. One respondent in three considers the gender quota to be unnecessary. Likewise one in three respondents assumes that the quota will make it easier for women to build a career. Among the female respondents, the positive assessment outweighs the negative one: around 42 per cent view the step as necessary and long overdue, more than two thirds expect the gender quota to result in more advantages than disadvantages.
  • All in all, around 44 per cent of the respondents expect a supervisory board consisting of at least 30 per cent women to work more efficiently (as compared to boards with a lower share of women). However, the approval figures vary considerably between the two genders. Just below 87 per cent of women agree but only around one in four male supervisory board members (around 23 per cent). The male respondents are very cautious towards expressing an opinion: around 55 per cent are undecided, while around 7 per cent stated that they are not able to assess this issue.
  • Rounding up, 61 per cent of all respondents stated that they had already actively addressed the topic "promotion of women" within the supervisory board or that they had filed a corresponding request (around 68 per cent women / 55 per cent men).

Reasonable or not: the appointment of new members is viewed as a challenge, supervisory board networks will be broken up and women will be addressed professionally by consultants. Rather than female alibi-staffing, clear profiles will be sought.

  • Most of the respondents assume that the gender quota will make the recruitment of qualified candidates more difficult in the future. Just below 61 per cent consider this "slightly more difficult" or "considerably more difficult". Male respondents are considerably more pessimistic: around 77 per cent expect further complications while not a single one expects the recruitment of qualified candidates to become easier.
  • Women have benefitted from the gender quota already. Half of the female supervisory board members think that the gender quota played an essential or at least important role within their appointment to the board. 82 per cent of the men, on the other hand, deny that the gender quota has an effect on the appointments.
  • Female supervisory board members much more frequently received their mandate through a consultant than men did (around 45 per cent vs. around 23 per cent). Most men were directly addressed by the chairman of the board (48 per cent).
  • Around 82 per cent of the respondents stated that they had to fulfil a specific profile regarding their appointment. Nearly 93 per cent felt they were appointed due to an expertise their supervisory board colleagues did not have.
  • Close to three quarters (around 73 per cent) of the respondents believe the criteria according to which supervisory board members are currently appointed to be appropriate.

Overall, there is a high level of satisfaction with the supervisory board and the supervisory board members, above all, want to contribute their competence.

  • The respondents describe their supervisory board as very well positioned overall. On a scale reaching from 1-5, the approval figures are between just below 54 per cent (legal expertise) and 87 per cent (business expertise.)
  • The large majority (80 per cent) considers a term of five years for a supervisory board mandate to be appropriate.
  • To "contribute competence" received the highest level of approval regarding the requested motivation for the takeover of a supervisory board mandate. To "be closer to leadership" was the least important motivation factor among the respondents. Within all queried areas, the approval figures were significantly higher among female supervisory board members.
  • Men tend to be more satisfied with the supervisory board remuneration than women. Around 68 per cent consider the supervisory board remuneration to be adequate. However, only 58 per cent of the female supervisory board members think so. Overall, the satisfaction level is high though: close to two thirds of the supervisory board members (around 64 per cent) consider the remuneration to be adequate.