Transparency Obligations Ignored: Lack of Women in Management Ranks

Many public companies ignore legally required transparency obligations when it comes to the proportion of women in their management ranks. But if the state claims to be a role model, it should live up to it.

DReality often lags behind wishful thinking. When the federal government got serious about promoting women in German top management two and a half years ago, it said that public companies should set a good example. At least that’s how ministry officials put it in the justification for the new regulation with the awkward name “Second Management Positions Act”, which, among other things, requires certain large companies to have at least one woman represented on the top management level in the future. Although the proportion of women in the executive suites of public companies is traditionally slightly higher than in comparable private companies, private companies have caught up in recent years.

A new study by the Zeppelin University in Friedrichshafen now casts a bad light on public companies: Actually, all companies with more than 500 employees have to set their own targets for the proportion of women on the second and third management levels. This is intended to ensure that there are enough experienced female candidates later when positions become available at the first management level. But it is precisely here that many public companies are clearly negligent. 40 percent of the units examined do not set any targets at all or at least do not publish them, even though this is required by law. It’s quite possible that things don’t look any better in private companies; many may speculate that they will get away with it and may face a fine. When asked whether notices of fines had already been sent, the Ministry of Justice responded, “according to the current state of knowledge”. If the state claims to be a role model, it must live up to it. Otherwise it would be better to forego this regulation.