• Fabio Carvalho, Digital Marketing Specialist at Nets Switzerland AG


• 21.10.2021 03:15 pm
#payment

Angela Merkel has not only secured her place in the history books, but her career encouraged many women to take the challenge in politics and in business. While her 16-year long stint as German chancellor approaches its end, women remain head of state in Denmark (Margrete II), Ethiopia (Sahle-Work Zewde), and in Kosovo (Vjosa Osmani). On the helm of the European Commission and the European Central Bank, Ursula von der Leyen and Christine Lagarde respectively hold the banner of European feminism high.

Missing Merkel effect in business

Nevertheless the era of the “Queen of Europe” has not helped to advance female inclusion in Europe’s biggest economy. In the DACH region (Germany, Switzerland, and Austria) there is ample room for improvement in relation to gender equality: 

• Female board participation in Germany plummeted to 25% in 2020 compared to 33 percent in the pre-pandemic year 2019. That minority figure stands in stark contrast to neighbour France were female board participation slipped only by 1% to 43% in the same period (see Chart 1).

• Switzerland remains a developing country in relation, while female participation rose by 1% in the same period, the share of women on boards remains at 26% a marginal parameter. 

• In Austria, as per the end of 2020 only 14 out of 191 stock listed companies were led by women.

Chart 1

Source: OECD

However, “The representation of women is only part of the story. The pandemic continues to take a toll on employees, and especially women,” according to the latest  “Women in Workplace” by McKinsey, released in September 2021 (423 participating organizations, 65,000+ respondents). 

Women’s representation across the corporate pipeline has gradually increased since 2016 in the US, but the pandemic has slowed down the progress women have made since 2019 (as shown in the chart below). Entry-level female employee proportional growth has flatlined, as has VP growth.

Chart 2

Source: McKinsey

But women still lag behind men in being promoted to manager level – the first rung on the corporate management ladder. In 2021, 86 women were promoted to manager level for every 100 men that were promoted, hence men significantly outnumber women at the executive level. In 2019, it was 72 women for every 100 men. This explains why representation of women at the senior manager, director, and VP levels has improved more slowly than the pipeline overall. While a higher proportion of women are being promoted to manage level in 2021 over 2019, men continue to take the lion’s share of promotions.

Chart 3

Source: McKinsey

Masked Headwinds 

The fact that the number of female CEOs among the Fortune 500 – the 500 largest firms representing U$31.7 trillion worth of revenues has reached with twenty-three an all-time high in 2021 sounds encouraging. But the female share remains tiny, at 4.6%. 

In addition the Covid-19 virus waves has hit sectors with high female participation. “A year and a half into the COVID-19 pandemic, women in corporate America are even more burned out than they were last year—and increasingly more so than men”. That the sky is no longer the limit for ladies has several reasons. 

• While work from home led meant for working mums the advantage of focusing on setting up pr expanding their e-business, the closure of schools and subsequent home schooling led to a double pressure and a loss in productivity, for single mums in particular.

• Sectors with a high share of female employees came under economic pressure in particular such as travel, tourism, and the hospitality sector. 

• Women on a maternity were exposed to a higher risk of being made redundant than men.

• Family businesses like hoteliers, restaurant owners, shop keepers, or laundries came under financial pressure as they often lack of ample financial reserves. 

• In addition, one in three women says that they have considered downshifting their career or leaving the workforce this year, compared with one in four who said this a few months into the pandemic 

“As if these woes were not enough, financial emergency packages distributed by government were in many cases insufficient, especially for small shop keepers, kiosk owners, artists, dancers, choreographs, painters, stage decorators and related professions, all activities where women are overrepresented”, said Marianne Bregenzer, CEO of pay terminal provider Nets Switzerland. “Aside from these tangible factors, intangible factors such as burnouts, mental health issues, and family stress due to the pressure on budgets and businesses have taken their toll on feminine finances.” 

Online harassment has increased too during the pandemic, according to “2021 report on gender equality in the EU”.

The Way Forward 

Nevertheless, the disruptive impact of the pandemic which led to lockdowns and closed borders provided also backwind for women in business:

• More firms started to tolerate post-pandemic work from home schemes along with flexible work models which paved way for the inclusion for working mums, women of determination, and elderly women.

• Learning programs are designed at a growing number for firms such as Euler Hermes for all employees while taking into account the career stage of women (fresh graduate, maternity leave, working mums). 

Meanwhile, the success parameter “accountability” has reached the “female office”. While Germany’s Christian Democrats are proud of Ms Merkel’s credentials as Germany’s first Madam Chancellor, only 24.1 percent voted for her CDU and her sister party CSU, marking the worst result for the conservatives in the history of German elections. In addition, the current affair around allegedly overstated data in rankings produced by the World Bank has cast a doubtful light on the IMF’s Managing Director Kristalina Georgieva who served as Acting CEO of the World Bank before. The pressure on the Bulgarian economist shows that women on top can no longer count on a “female bonus”. 

These developments however also proof that women have reached the center stage. “Fifty percent of the population should translate into 50 percent of female share at workplaces,” said renowned author Gill Whitty-Collins (“Why Men Win at Work”) at the FT’s Women in Business Forum. While marketing departments have made progress, she said, other areas like corporate finance and leadership roles were still heavily male-dominated. “What we need is awareness, awareness, awareness,” she added. Awareness is also necessary in relation to the promotion of technology, such as mobile pay terminals, virtual offices, e-commerce, and “e-ducation”, and how it opens doors for women seizing the initiative by creating their own venture. ***