Company Culture
One interviewee described the situation this way: “Usually, the members of the management board have grown up together in the company.” This shared (ladder-climbing) story bonds them. Statistics (see above) show that it is also highly likely that these individuals are a group of men from similar backgrounds. As a rule, female board members are automatically viewed as “the new kids in town.” The result is a historically nurtured, male-dominated culture. Women generally fail to pass muster – just like other diverse candidates.
A corporate culture – or simply put, “the way things work here” – is defined from the top downwards. If a company has a homogeneous management team, this team will set the standard by which all male and female employee measure themselves. This standard will apply to both written and observable policies as well as to non-codified and hidden customs.
Many of our interviewees expressed frustration about the fact that Corporate Germany remains wedded to such old structures and patterns and is only willing to change slowly. “A large number of female executives have yet to assume the right positions of power,” one male interview partner said. “Until that happens, other networks will continue to fill the positions and determine the candidates.”
Today, the values and behavior patterns of men define interaction on top managerial bodies. One female interview partner noted that male board members were “much more emotional, much less controlled and much less in tune with the mood in the room” than their female colleagues. “Male executives feel that success is all about power, money, position and prestige and not about something more equitable,” the top female executive said.
However, male executives appear to demonstrate surprisingly quick unity in the way they work with female members of management boards – female executives reported in a study that they felt systematically left out of important decisions.⁸ Established members of the board – usually men, of course – consult with them less often and sometimes even ignore them. Companies with a culture dominated by male executives tend to treat female executives in top positions – like those on the management board – not as full members of the group.
Supervisory board members and CEOs of both genders can cement this male hegemony. But they also have the power to break this cycle when it comes to changing the culture and the way people interact with one another to create a form of diversity in action. The first step is to accept that such a cultural challenge will not be achieved through a handful of measures – and it will certainly not happen quickly. If female and male members of supervisory boards (and, above all, CEOs) are serious about creating diversity and developing an inclusive corporate culture, they will demonstrate that they are aiming to do something more than achieve a quantitative target. And only then can a diverse and high-performance team develop. The chair of a supervisory board must play a special role, as they “can see whether or not a CEO is fostering a diverse culture on the management board.” Should this not be the case, it is the chairman’s duty to intensively discuss the issue with the CEO.
First and foremost, whenever a board is expanded or a member is replaced, a CEO and the management board must clearly understand how the existing team dynamics work and which contribution each individual board member makes. All members must be aware of how the new female board member will complement this team, what her values are, the ambitions she will pursue, as well as her personality. Many CEOs and chairmen of supervisory boards are not used to a concept like this – the idea of creating room to get to know one another on a deeper human level, something that extends beyond their professional identity. They are not used to considering questions like: “what has shaped me?”, or “what makes me unique as a person”? Posing these questions individually and especially in the team, separately from the gender question, represents the first step in improving the culture of managerial bodies. As a result, they can see how new members can change the dynamics on the management board team – and what they should contribute for the team to grow together. They should invest time and energy familiarizing themselves with the new structure. Obviously, the team dynamics will change when a female executive – particularly if she is the only one – joins a management board. But the change must be made by all team members – and not, as is frequently assumed, by the new female member alone. This is the only way that a company can truly embed diversity into their way of operating.
It is the job of the entire supervisory board to set benchmarks for diversity in top management positions. It is then the responsibility of the management board to carry out the onboarding process . The head of the supervisory board plays a role that is frequently overlooked, as do the human resources, nomination and executive committees that perform an important control function: “In my case, the chairwoman of the supervisory board opened her network to me and introduced me to other chief HR officers,” one female board member said. One key to this process is to always present the female board member as an expert in her field – and not just as a pioneer in female leadership. One interviewee correctly noted that female executives must get to know the existing “co-optation mechanism” that is “influenced by participating actors and determines whether conservative or more open-minded personnel decisions are possible.” In contrast, many male and female members of supervisory boards considered formal committees devoted to diversity to be ineffective.
Central Company-Related Factors
Company cultures are defined from the top downwards. Male-dominated managerial bodies frequently project gender stereotypes throughout the organization – stereotypes that alienate women in top leadership positions.
Company performance is higher with diverse management boards, meaning that supervisory boards must think seriously about creating diverse management boards as part of their overall mission. They must also shoulder the responsibility of embedding diversity into their daily operations.
A male or female CEO cannot just be presented as a passive role model for diversity. This individual must also work with other members of the management board (executive responsibility) and create an environment in which all team members get to know one another in order to consciously integrate new team members into the group. A “co-operation charter” – specific agreements on the group’s working relationship – can help tremendously in this effort. Such good examples will create the necessary change that will ultimately lead to an inclusive culture.
Voices from Our Study:
“Support from the supervisory board chairperson sends an important signal.”
“As is the case with any sort of cultural change, nothing will happen if the CEO – whether male or female – does not want it to. The real question is: does the CEO embrace the idea of enrichment, of change? If so, I think the chances are very high.”
“If the supervisory board itself has a diverse membership, the assessment of male and female candidates will be more consistent and neutral. Female members of supervisory boards are often able use their networks to bring more women into the appointment process.”
“We need more chairwomen of supervisory boards, and we need more women on the committees. I would also like to see more supervisory boards that comprise equal numbers of male and female members. These boards should also be able to gain everyone’s support and create more transparency.”
“One good practice should be to provide new members of the management board – no matter whether they are men or women – with a contact partner or dedicated contact partners. The supervisory board has a clear responsibility, particularly when an outsider joins the company.”
8 Harvard Business Review, 2013: Dysfunction in the Boardroom