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Article - Women in Business

Women are vital to the German economy

Introduction

Through their roles in business, entrepreneurship, skills and science, women are playing a key role for the economy.

Women make a significant contribution to the German economy. Women make up about half of the population and are highly trained professionals: they create new products, services and jobs. In their role as decision-makers, they are actively shaping the future of our country.

Despite all this, executive positions in Germany remain largely a male domain. Most recently, women accounted for 13.4% of the board members of German listed companies (reference: AllBright Report, Autumn Issue of September 2021 (PDF, 3 MB)). This represents a 32% increase over the figure for the preceding year.

However, this still puts Germany behind some of its international competitors, including the U.S., France and the UK. This could turn out to be a competitive disadvantage for Germany in the medium term as many studies have shown that the more diverse a company’s management board, the more successful and innovative a company will be.

It is therefore important for the German economy for women to be able to bring their full potential to their economic activities. This requires a number of different approaches to be taken at various levels. It all starts with the need for new role models and with addressing certain stereotypes. This should happen in families, at school, in vocational training and in university. The aim is to get girls and women interested in STEM professions and female entrepreneurship. Successful role models and strong networks will also help attract more women into business.

Economic policy is always also a policy for women

Equal opportunities in the workplace is an issue for and a factor driving the economy. Providing support for women in business and making their achievements more visible is an economic policy goal and also an important aim of the Economic Affairs Ministry. The #StarkeFrauenStarkeWirtschaft series of events gives women entrepreneurs and female decision-makers in business a possibility to state their views and enter into discussions with the most senior representatives of the Ministry on challenges to gender equality in the business world and how these can be tackled.

The Economic Affairs Ministry is thus adhering to its guiding principle of the Social Market Economy, which understands social justice and inclusion as a foundation stone for everyone to share in prosperity. Gender equality is an integral part of the Ministry’s policy – be it with initiatives like FRAUEN unternehmen its discussions with business representatives or at the annual  Girls‘Day.

Four figures about women in business

36
Symbolicon für Frau

per cent
is the proportion of new businesses founded by women

38
Symbolicon für Netzwerke

per cent
is the proportion of new full-time businesses founded by women

34,8
Symbolicon für Statistik

per cent
is the proportion of women on the supervisory boards of DAX companies without a women's quota (October 2020)

36
Icon for meeting

per cent
of management positions in the federal administration are held by women

Giving women entrepreneurs a boost

Using role models to encourage women to start out in business

Only one in three companies is founded by a woman. As for technology-based start-ups, the statistic is even lower. This shows that the start-up scene needs to become more attractive for women.

Being their own boss and actively shaping the future: there is a lot that women startup entrepreneurs can achieve. They can use their ideas and their respective business culture to enrich and strengthen Germany’s business landscape.

Most people in Germany still think of men when ‘entrepreneurs’ are mentioned. This is despite the fact that one in three companies is founded by a woman. However, many of these companies are sideline businesses (42.1%), reference: 2021 KfW Startup Monitor, tables and methods volume (PDF, 2 MB), as women tend to opt for more flexible, hybrid income models, e.g. by combining employment with a sideline business.

It is fairly uncommon for startups to be established by teams of women. These account for just under one in five startups in Germany (17.5% according to the German Startup Monitor (PDF, 6 MB)

There is a lot that women startup entrepreneurs can achieve: to be self-employed also means to put your own ideas into practice, be it for a more sustainable way of doing business or for more flexibility around working hours and places. More women entrepreneurs also mean more jobs and a boost to economic growth. A high level of diversity of business models and corporate cultures can also generate crucial competitive advantages.

Successful women entrepreneurs as role models

The Economic Affairs Ministry wants to encourage women to use their qualifications and skills to realise their own business ideas and to establish successful companies. One way of fostering this is to highlight the work of successful women entrepreneurs to turn them into positive role models. 

Under the Ministry’sFRAUEN unternehmen initiative, more than 220 women entrepreneurs from across all industries and parts of the country volunteer as ‘role model entrepreneurs’.

They encourage schoolgirls, trainees, students, graduates and other women interested in setting up their own companies and make them aware of the opportunities and challenges awaiting them. This gives the women and girls a realistic and highly personal insight into what daily life as an entrepreneur is really like. The women entrepreneurs show how entrepreneurship can be an attractive career option for women. The ‘FRAUEN unternehmen’ initiative also helps to make the work undertaken by female entrepreneurs more visible – presenting their success, their dedication, and their contribution to the future of Germany’s economy.

Supporting entrepreneurs

The Economic Affairs Ministry provides women interested in entrepreneurship with tailored information on how to set up a new business. Women entrepreneurs can access information on more than 2,000 regional partners via the Economic Affairs Ministry’s integrated information services and thus find networks, centres of women entrepreneurs and mentoring programmes.

In order to provide even more targeted support for prospective entrepreneurs and women and men interested in starting their own business, particularly during the planning stages, the Economic Affairs Ministry and KfW have set up a platform for entrepreneurs that is free to use and provides entrepreneurs with a digital toolkit covering all steps of the process of starting one’s own business. It allows budding entrepreneurs to develop a first idea or business model, draft a business plan, enquire about funding and financing and contact the relevant institutions online. In addition, the platform hosts videos of successful entrepreneurs sharing their experience and giving useful advice. The platform’s network of partners currently consists of more than 600 key stakeholders from start-up funding. The platform has a special landing page dedicated to women interested in starting their own business.

Wall with post-its from an Start-Up; Quelle: Getty Images/Emely

© Getty Images/Emely

Start-ups: a driving force for growth and competition

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Breaking through the glass ceiling

Having more women in executive positions is an important step towards greater gender equality in the world of business and work.

The Act on the Equal Participation of Women and Men in Leadership Positions in the Private and Public Sector, which became effective on 1 January 2016, introduced a fixed gender quota of 30% where new supervisory board positions have to be filled in the 107 companies in Germany that are listed and subject to full co-determination. This rule has led to a marked increase in the number of women on the supervisory boards of listed companies, bringing it to 35.4%. By contrast, however, the share of female members of the board of Germany’s 160 listed companies is much lower. According to the 2021 AllBright Report, Autumn Issue (PDF, 3 MB), it stood at 13.4% in September 2021 (up from 10.1% in 2020).

The Act Amending the Rules on the Equal Participation of Women and Men in Leadership Positions in the Private and Public Sectors, which entered into force on 12 August 2021, is to help further increase the share of women in leadership positions. It notably sets out a minimum requirement for female participation in leadership positions in the private sector, stipulating that listed companies and companies that are co-determined on the basis of parity must, in future, have at least one female member on the management board if that board has more than three positions. The new rule applies for new appointments made as of 1 August 2022.

Companies in which the federation has a majority shareholding and which have more than two members on their leadership body are already required to have at least one of these positions filled by a woman. For these companies, a firm ‘women’s quota’ of 30% also applies as far as membership of the supervisory boards are concerned. This shows that the federation is leading by example. Similarly, entities organised under public law that have at least two members on their boards must appoint at least one woman. In the public service, equal participation of women and men in leading positions is to be achieved by 2025 across the scope of the Federal Act on Gender Equality.

At the Economic Affairs Ministry, a wide range of measures geared towards increasing the share of women working in leadership positions at the Ministry has been introduced in recent years (see balancing career and family life). Over the 19th parliament, the share of women was thus raised by approx. 25% to 43% (compared to 34% in 2017).

Worker

© iStock.com/industryview

Skilled professionals for Germany

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Combining Family and Career

The competitive advantage of being family-friendly

In order to keep up in the competition for skilled labour, employers need to give their employees all the support they need to be able to combine their job with the responsibilities they have in their private lives. Helping employees balance career, family and caring commitments is an important component of employer attractiveness. Even today, the demographic development is resulting in a clear skills shortage in some occupations, sectors and regions.

The competitiveness of our companies depends largely on the creativity, performance and skills of the employees. Companies which reward creative commitment and offer working conditions which make them competitive in the long term will always benefit from motivated employees and their innovations. Measures to improve the compatibility of family life and work pay off for the business and for the economy.

A family-friendly company has greater employee loyalty

The entire business culture must become more family-friendly. This will allow women in particular to develop their potential in working life and their leadership qualities. Studies show that it is still mostly the women who take charge of caring for children and relatives; however, the number of men who want to raise their children or care for an ailing family member is also growing. Whether it is flexible working-time models, reintegration courses, working from home opportunities, mentoring programmes, job sharing programmes, coaching for women executives or women’s networks – the measures available are diverse and must be mutually coherent.

The family-friendly business culture must be backed by a care infrastructure which is close to home, meets the needs, and is high quality.

The digital transformation opens up new opportunities for women to work

The digital transformation is opening new opportunities for young families in the world of work, especially mothers, and can offer alternative career paths. For example, digitalisation and work 4.0 are expanding the level of flexibility with regard to working times and places of work, thus making it easier to combine family responsibilities and a career. They therefore play a key role in promoting equal opportunities for women and men in business and the world of work.

Flexible work patterns have a considerable impact on women’s representation in the workforce. For example, a study conducted by KfW found that women’s representation in companies providing a family-friendly working environment is 9 percentage points higher than in other companies. This makes digitalisation an important instrument for unlocking women’s potential – and attracting skilled labour in times where competition for talent is growing is key for employers to remain attractive.

Digitalisation can also open up opportunities for self-employment and realising one’s own business ideas, not least for women. The new possibilities offered by a digital working environment not only provide for more flexibility: digital business models also open up numerous opportunities for women to use their creativity.

Setting a good example: a family-aware HR policy in the Federal Ministry for Economic Affairs and Climate Action

The Economic Affairs Ministry is setting a good example in terms of compatibility of work and family life. Since 2002, the Economic Affairs Ministry has been regularly awarded the ‘audit berufundfamilie®’ for family-friendly employers by berufundfamilie GmbH. The Economic Affairs Ministry was the first Federal Ministry to receive this certificate. In June 2020, the Economic Affairs Ministry was awarded the permanent certificate honouring its many years of sustained commitment to an HR policy that is family-friendly and takes into account all phases of life. Tailored part-time models (also offered to those in managerial positions), mobile working opportunities, events to help employees transition back into work after a long absence, an in-house mentoring programme and parking spaces reserved for employees with children have been implemented as a result of dedicated work and commitment throughout the Ministry.

Interviews with strong women

Interviews with strong women

Germany is one of the most successful economies worldwide, not least thanks to the contribution of its many strong women. On the occasion of International Women’s Day, eleven successful women shared their experience.