The former Deutsche Bank boss Josef Ackermann once had to find out how quickly you can get into a vortex when it comes to diversity. When the 2011 balance sheet press conference focused on women on executive boards, Ackermann said he hoped that one day there would be a woman on the management board of Deutsche Bank, then things would be more colorful and beautiful there. In the days that followed, the bank’s press department was busy trying to recapture the words.
Even ten years later, it has not become easier for managers to strike the right note and take suitable measures to make their own company more diverse. Entire marketing departments are concerned with communicating ethically and gender-correctly and reaching lesbian, gay, bisexual, trans, queer and intersex people (LGBTQI for lesbian, gay, bisexual, transgender, queer and intersex). Some consider “pink banking campaigns” to be helpful in attracting attention. Others, however, are already feeling a certain tiredness in the face of aggressively advertised company logos in rainbow colors or the umpteenth programs to promote women. In any case, critics see this as merely “pinkwashing”.
In the financial industry in particular, there are many men’s silos
Today, all companies want to be diverse. In the financial sector, however, the need to catch up is particularly great. The proportion of women on executive boards is around ten percent. “Not much has moved there for 30 years, that’s a flat line,” says Alexandra Niessen-Ruenzi, professor at the University of Mannheim. Only in the “pink ghettos”, the marketing and personnel departments, is the proportion between 30 and 50 percent. In areas such as portfolio management, accounting or law and compliance, on the other hand, only a few women are to be found.
Improvement is not in sight. The proportion of female applicants in German-speaking countries is even declining: “This has to do with the poor image of the financial sector, the male-dominated environment and the elbow mentality,” says Niessen-Ruenzi, who was responsible for the study “Fearless Girls?” In 2018. 1100 economics students in Frankfurt, Mannheim and St. Gallen surveyed. But why is that?
Studies repeatedly show that companies with mixed teams are more innovative and creative, that they also achieve better results and are more successful in the long term. Even satisfaction within the workforce increases. According to Niessen-Ruenzi, many companies were also very open to soft measures, almost all financial institutions now have a diversity officer, but only a few set themselves quantitative goals. “There is a lack of fixed promotion quotas at all hierarchical levels and there is a lack of pay transparency.” Without quick and tough measures, it would be half a century before something changed.
Deutsche Bank aims to have a third of management positions held by women by 2025. Critics don’t go far enough. “The German institutions lag behind other international institutes in terms of work models, childcare and equal pay,” says Anne Connelly, founder of the fund women career network. Female managers are also underrepresented in the fund industry: “In Germany there is no six percent,” says Connelly. Women like Abigail Johnson, head of the US investment house Fidelity, who took over from her father, are generally the exception. Investors also prefer funds from male rather than female fund managers. “A clear, if perhaps unconscious, discrimination,” says scientist Marc Oliver Rieger from the University of Trier.
Certificates for women and LGBTQI funds already exist
The industry is particularly diverse when it comes to doing business with the respective clientele. If you want, you can invest in certificates that are specifically aimed at women and only contain titles from companies that are run by women. “Women as top managers lead at least as well as men, maybe even better,” says Bank Vontobel, for example. Funds for the LGBTQI community have also long existed. What sounds nice, however, is of limited use. “It is quite difficult for investors to judge whether one can really achieve an effect with such investments,” says scientist Rieger. It is safer for investors to save the fees for such funds and instead donate them to a good cause, says Rieger: “For example, for projects in countries where discrimination is even more threatening than it is here.”
Rieger also warns against suspecting discrimination behind every difference: “Women invest significantly less in stocks than men, even if they have enough financial resources to do so.” This difference can be explained by cultural stereotypes, but also by different risk preferences. “So the whole thing is a complex subject.”
The banking supervisory authority now wants to take care of more gender diversity
Soon there could be more movement in the subject. The European Central Bank (ECB) would like to advocate more gender diversity in the governing bodies of banks. “In the future, we will examine more closely what progress the banks are making. We will ask them whether they have set internal diversity goals and whether they are actually achieving these goals,” said a guest article for various media.
Diversity goals should be linked to a bonus, says Connelly, for example. She advises women to better network and seek influential mentors. “If you just sit in the corner and are disappointed, you won’t get any further.” However, the Corona crisis has made it more difficult to make contacts, as silos tend to become even stronger.
It seems to be beneficial for women’s careers to change employers more frequently, as a study by the international consulting firm Heidrick & Struggles shows. However, the study also finds that mentoring programs, which minorities are often overwhelmed with, also have their downsides. This is what the Swedish researcher Laurence Romani named: In studies she comes to the conclusion that, of all people, human resource managers who advocate diversity actually increase inequality because they see people as needing help.
Even with a badly done campaign, companies like Josef Ackermann can fare quickly – a supposedly noble gesture then turns into discrimination. That’s why, according to Heidrick & Struggles, a manager is needed who simply paves the way for minorities.