gender diversity in business - gouvernement · representation remains an important issue and...

Gender Diversity in Businessseizing the opportunity, avoiding interference

in collaboration with the University of Luxembourg

This study was realised under the impulse of the ad-hoc working group “diversity” of Fedil, supervised by Mrs Michèle Detaille and Mr Raymond Schadeck. It received scientific support by Mrs Denise Fletcher from the University of Luxembourg. The report was drafted by Mrs Monika Kmochova and Mrs Ana Schoen, students at the University of Luxembourg.

This study

Table of contents

ForewordExecutive summaryRésumé analytiqueIntroductionGender diversity in a Luxembourg context: the current state of play

First conference Gender diversityThe speakers’ main thoughts The main themes

Second conference Financial performance The speakers’ main thoughts The main themes

Third conference Human resources The speakers’ main thoughts The main themes

Fourth conference Branding The speakers’ main thoughts The main themes

ConclusionReference list

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6 Gender diversity in Business

Ladies and Gentlemen

In 2011, as part of a partnership with the Ministry of Equal Opportuni-ties, Fedil launched an initiative to discuss and promote gender diversity in business, which centered on four conferences and culminated in this final report.

We are very aware that efforts to establish gender diversity by Luxembourg companies are still making slow progress since women are still underrep-resented in senior positions. We identified, therefore, the need to under-stand the situation in our country and the challenges we face. With this in mind, we began with a survey conducted amongst our members to map their perspective(s) on gender diversity. This data provided the basis for the organization of four conferences around the theme of Diversity, where keynote speakers shared their expertise and our panelists presented their arguments and experiences of gender diversity in a Luxembourg context. They also discussed the obstacles and barriers in promoting women’s ac-cess to positions of responsibility.

Fedil is conscious about the necessity of companies to recognize diversity for their own benefit and seek progress not only towards gender-based issues but also take into consideration other elements in diversity area.

This project, conducted jointly with the University of Luxembourg, is a result of our efforts towards establishing a clearer understanding and integration of the gender diversity debate into our business environment.

I hope you will find this report interesting and inspiring.

Robert Dennewald Chairman, Fedil – Business Federation Luxembourg

Ladies and Gentlemen,

As Minister for Equal Opportunities, my aim is to encourage a better distri-bution of responsibilities between men and women in every field of private and public life and above all in the labour market.

With a percentage of 60% of all university graduates, women are nowadays highly qualified and our economies need this potential of competences and know-how to keep on growing.

Unfortunately the employment rate of women only reaches 61,7%. Only 20% of the mandates at board level and 17% at management level are held by women.

During the past months, I noticed with satisfaction a broad consensus among all concerned actors the change this situation.

Fedil – Business Federation Luxembourg plays an important role in this context and became a valuable partner of the Ministry of Equal Opportuni-ties by taking up the topic of gender diversity in business and by dispatch-ing information and possible concrete actions among its members.

I take the opportunity to thank President Dennewald and his team for this strong commitment and I hope that it will be followed, in the near future, by the expected results as far as a better mix between men and women at all business levels is concerned.

Diversity in business is not only an element of gender policies.

Diversity in business is the key to more productivity, more competitiveness and a better work-life balance for men and women.

Françoise Hetto-GaaschMinister for Equal Opportunities

Foreword

The following contributed to the conference cycle

First Name Name Title Company / Organisation

Lydie Bauler Manager Leader Development Delphi Automotive Systems Luxembourg S.A.

Romain Bausch Board Member FedilPresident & CEO

SES S.A.

Amal Choury Managing Director e-Kenz S.A.

Hubert Clasen Board Member FedilManager

Caves Bernard-Massard S.A.

Fabienne Dasnoy Diversity Officer Luxembourg BGL BNP Paribas

Robert Dennewald Chairman FedilPresident

Eurobéton S.A.

Michèle Detaille Board Member FedilManaging Director

No-Nail Boxes (Europe) S.A.

Eva Ferranti Owner – Manager Eva Ferranti S.A.

Françoise Folmer Partner Team 31

Denise Fletcher Professor of Entrepreneurship and Innnovation

Université du Luxembourg

Betty Fontaine Board Member FedilDirecteur général

Brasserie Simon Exploitation et Cie S.e.c.s.

Eliane Fuchs Owner – Manager Banque BCP

Marc Gerges Partner – Editorial and Communication Manager

Maison Moderne Publishing S.A.

Robert Goeres Managing Director Goeres Horlogerie

Rita Goffin Deputy General Manager Systemat Luxembourg PSF S.A.

Laurent Jossart CFO Luxair S.A.

Pierre Kihn CEO Office Freylinger S.A.

Jacques Lanners Vice-Chairman FedilDirector representative and Chairman of the Supervisory Board

Cératizit Luxembourg S.à r.l.

First Name Name Title Company / Organisation

Romain Mannelli EVP Corporate HR RTL Group S.A.

Dale E. Meikle Global Diversity & Inclusion Program Office Leader

PricewaterhouseCoopers International Ltd

Jean-Michel Monnot Director of Diversity Sodexo Europe

Fabrice Poncé Chairman ULEDIDirector General Adecco Group Luxembourg

Adecco Luxembourg S.A.

Diane Ries Managing Director HR Services S.A.

Evie Roos Board Member FedilVice President HR

ArcelorMittal S.A.

Sandra Sancier-Sultan Principal McKinsey & Company

Raymond Schadeck President of the Board Luxexpo

Christian Scharff Partner Human Resources Services

PricewaterhouseCoopers S.à r.l.

Katia Scheidecker Partner Cabinet MNKS

Dominique Schmit Human Resource Manager Soludec S.A.

Ursula Schwarzenbart Director Global Diversity Office Daimler AG

Silvia Sitzen Board Member FedilDirector HR Lux. & Regional Services

Goodyear Dunlop Tires Operations S.A.

Nicolas Soisson Director Fedil – Business Federation Luxembourg

Jean-Luc Verheggen Human Resources Manager

DuPont de Nemours (Luxembourg) S.à r.l.

Guy Wagener Conseiller de direction 1ère classe

Ministère de la Fonction publique et de la Réforme administrative

Christiane Wickler Managing Director Pall Center


Executive Summary

The issue of gender diversity is becoming an increasingly important topic that is being discussed all over the world and in varying contexts. National governments as well as private institutions are continuously conducting studies concerning gender diversity in an effort to analyze the situation in each country and propose recommendations for achieving greater gender balance in the workplace. Luxembourg (with the cooperation of Fedil, the Business Federation, the Ministry of Equal Opportunities and the Univer-sity of Luxembourg) has initiated a series of conferences regarding gen-der diversity in the Luxembourg economy, in order to stimulate advanced awareness, debate and sensitivity to gender matters in organizational and government policies. The objectives of the conferences were to:

1. Inform about the situation in Luxembourg in terms of gender diversity.2. Discuss the key issues in gender diversity.3. Share existing good practices and outline ways to implement organiza-tional solutions that help change mindsets regarding gender diversity.

The first conference served as an introductory and information sharing ses-sion, where the general issues concerning gender diversity were discussed. The panelists shared their experience about family constraints, gender stereotypes and the effects of “men’s world” perceptions on recruitment and promotion. In addition, the panelists presented their general experi-ences and views on the behaviour of women with power and responsibility in organizational life. In the second conference, the discussions centred on the topic of “Corporate Financial Performance”. In terms of gender di-versity, attention to performance is argued to be important for evaluating whether and to what extent female employment (especially on boards of directors) adds more value to the company’s overall competitive and finan-cial performance. The third conference focused on the human resource practices and policies that were significant for improving gender diversity. In the fourth conference, attention was awarded to the benefits of gender diversity for an organization’s external reputation, marketing orientation and approach to corporate social responsibility. In all 31 speakers contrib-uted to the conferences with more than 300 participants, 40% of whom were men. The speakers represented many sectors and industries, such as public, banking, media and telecommunication, brewery, car industry and constructions.

Raising awareness and dialogue

regarding gender diversity: four conferences

in Luxembourg

In the following sections we draw from the four conferences and its various speakers, as well as key reports and literature on this topic.

Gender diversity in the work environment and especially in terms of board representation remains an important issue and challenge for Luxembourg’s businesses. In spite of the fact that in 2011, women in Luxembourg ac-counted for 50,3% of the total population (STATEC, 2011) and for 51,4% of students at the University of Luxembourg, women are still underrepre-sented in higher decision-making positions. A positive sign, however, is that the female employment rate has increased in the last decade, from 55,1% in 2003, to 62% in 2010. The proportion of women in part-time jobs, however, remains higher than in surrounding countries. Moreover, regard-ing employment in the public sector in Luxembourg, evidence shows that this is an environment within which female employment is higher.

When the focus is turned to management positions, female presence is more limited. In Luxembourg, women represent only 6% of the highest deci-sion making bodies (chairpersons and members of the board of directors) and these tend to be mainly non-nationals (Eurostat 2011, European board diversity analysis 2010). This indicates that cultural diversity is well devel-oped in Luxembourg. In terms of gender diversity, however, Luxembourg still has considerable progress to make to improve the situation.

A positive sign, however, is that diversity is already strongly visible in the mission(s) and operational practices of many Luxembourg organizations. For example, the results of a survey conducted by Fedil indicate that for almost half of the participating companies in the research (43,15%) there is evidence of diversity awareness, but formal programs are still rare. The majority of the organizations (78,62%) do not have policies for female promotion to higher positions and only 14,58% confirmed the existence of awareness programs. More positively, the survey also reported the willing-ness and the capability of majority (80,71%) of the companies of imple-menting training and mentoring programs to foster female careers.

1. What is the situation in

Luxembourg in terms of gender

diversity?


Quotas or no quotas?

A central question regarding the issue of gender diversity, especially with regard to the inclusion of women in senior management roles, relates to the use of quotas, i.e. government regulations that legally enforce the proportion of women in senior roles. Perspectives about such regulations vary widely between countries as well as between governments. Some countries decided to adopt legal quotas with sanctions (France, Italy and Belgium). Other mechanisms can be found, such as “comply or explain” (The Netherlands), the imposition of rules concerning only state-owned companies (Denmark, Finland, Greece, Austria, Slovenia), state voluntary targets (UK) and charters that companies can sign up to (The Netherlands, Denmark). Companies and governments in other countries who are still undecided are involved in wide-ranging debates which address the pros and cons of the use and adoption of legal quotas. A recurring argument against legislative measures lies in the fact that the quota system does not address other levels within the organization, including female representa-tion at the executive level. Therefore, such quotas do not address the need to increase the representation along the entire organizational structure (OECD, 2011; McKinsey, 2012).

In addition, governments also have tools other than the legislative meas-ure of female quotas to increase opportunities and support women’s po-sition in the workplace. The Economist (2011) and McKinsey&Company (2012) identified the main ones: reasonable maternity and paternity leave, a school system that allows parents to have both paid jobs and subsidised or tax-deductible child care.

With regard to Luxembourg, the situation with women on boards is a seri-ous one. In spite of this, however, all the panelists at the Gender Diversity conferences, regardless of gender, did not approve of forcing companies by way of legal quotas to appoint women to the boards. One of the explana-tions put forward by the female participants for this is that women do not want to be appointed into senior roles only because of the quotas; they would prefer to be appointed through merit and talent, because they de-serve the role. Furthermore, all the speakers were clear in their message that when hiring new employees and appointing to the board, the most im-

2. What are the key issues

in gender diversity?

12 Executive Summary

portant criterion is to hire the best talent. This perspective was also held by the representatives of sectors that are traditionally more male dominated, such as technology companies or the construction and car industry. Here, it was argued that what is important is to make the industry more attrac-tive to diverse groups of people, for example through more flexible forms of working, more role models, greater support on the job and to change the mindsets of young people by providing wider career information and choices. Access to higher education in fields such as engineering and management in particular needs to be improved and so does the directing of talents to these fields. However, to change perceptions and stereotypes we need to start from a very early age.

A lot of speakers also mentioned that one of the main barriers to gender diversity in employment, especially in promotion situations is that women often do not project themselves and frequently underestimate the skills they have to offer. It was commented how men, in general, have less hesi-tation in evaluating or promoting themselves and how they advance faster in their career contrary to women who tend to go step by step through all the layers in the company. Thus, a more confident evaluation and recogni-tion of the skills that women bring can play an important role in overcoming narrow-minded perceptions and helping recruiters to value non-standard CVs and the breadth of experiences that a person can offer. Companies should also actively target women in their organization, maybe some of their female employees, who have the right skills and experience, to dis-cuss their intentions for promotion and taking on more responsibilities.

Women on Boards and organizational performance

Research findings from other countries and institutions are very contradic-tory on how female participation in boards of directors helps to contribute to the increased financial performance of the company. For example, re-sults of the Deutsche Bundesbank study of German financial institutions state that risk taking increases when the participation of women increases on the board but only after three years of participation and resulted in only marginal economic change. However, other studies report that com-panies with 3 or more women in senior management positions scored


better in all organizational performance criteria as well as in financial per-formance. They also indicate that companies with fewer women in senior management than three did not differ significantly in terms of financial performance. Thus, statistical proof of the direct causality between women employed in senior management and financial performance of organiza-tions is difficult to uphold.

In the case of Luxembourg this is even more difficult to assess because only 1 company in a sample of board of directors from listed companies with headquarters in Luxembourg had more than 3 women on the board – and this was only from 2009 onwards. Thus, it is too early to assess any direct causality between women’s involvement in boards and the financial performance of Luxembourg companies. However, this research did iden-tify that companies with women on the board were on average bigger and younger than companies without women. The reason for this can be that younger companies are not so traditional and therefore have a lower influ-ence of stereotype perceptions.

Thus, research results are very contradictory on this matter and finding either a positive or negative link does not necessarily reveal a causality of the relationship. It could be that women are the cause of better perfor-mance. At the same time, however, better performing companies tend to promote more women. What is important, therefore, is recognizing gender diversity for its own sake rather than promoting women or men to the board purely to enhance financial performance. This is because the more effec-tive the board of directors and board room processes are, the higher is the likely success of the company. What is crucial, therefore, is how effectively the board is comprised, how the skill sets and abilities are combined and whether its members have access to critical information and resources. This point was echoed by many of the speakers at the conferences.

Gender diversity and the Human resource management function

A dominant view of diversity from a human resource perspective is based on the principles of Equal Opportunities, which focus on equality and fair treatment. This approach however, takes an exclusively collective focus in its treatment of every person as an equal part of a greater whole, rather than fostering a valorisation of personal differences.

Diversity management, in contrast, focuses on the unique strengths of people besides giving each individual an equal opportunity. The attitudes related to diversity issues in corporations are not characterized by uniform-ity and clarity but by a variety of understandings and applications. A diverse workforce is characterized by more than a simple increase in the numbers of racial, cultural, gender or class representation. Instead, it acknowledg-es a combination of multiple beliefs, perspectives, understandings that members of varied groups bring to an organization. Diversity management requires, therefore, a strategic and comprehensive approach which dem-onstrates clarity in how the company understands diversity as well as a following through of diversity into organizational culture and the practices it implements. The key and essential issues are senior management com-mitment along with cultural acceptance and integration of the programs.

To change the situation regarding gender diversity, companies need to change their corporate culture and work on all the dimensions of the com-pany. What matters is that this belief reaches all the layers within the organization. It is also crucial that the head of the business understands the concept of diversity. Companies cannot be forced to implement gender diversity, they have to be convinced and believe that it is a good thing. This requires a change in our mindsets and traditional ways of thinking.


The benefits of gender diversity for organizational reputation and marketing orientation

As discussed above in terms of financial performance, an increase in gen-der diversity on corporate boards is expected to have a positive effect on corporate reputation. Research evidence supports arguments that gender diversity on boards of directors may enhance practices of corporate social responsibility (CSR). This is partly because it is argued that women bring in-creased sensitivity to CSR and participative decision-making styles, which then contributes positively to corporate reputation. It is also found that having a positive reputation for diversity management and being recog-nized as an industry leader in this field is positively interpreted by investors and may enhance valuations and, subsequently, financial performance. For example, 70% of respondents in a study conducted by the European Commission (2003) affirmed that diversity awareness initiatives enhanced corporate reputation. Further research also points to a positive relation-ship between ethical behaviour in organizations and female participation on boards of directors.

Research evidence also highlights the improved access to new market seg-ments after implementation of a diversity management program. Women are identified to be the fastest growing segment of buyers. In Europe and America, women are responsible for around 70% of all home related pur-chases and make 80% of all consumer goods purchasing decisions. When women are included in board composition, therefore, it is argued that they contribute valuable experiences and insights about customer behaviour and purchasing decisions.

Drawing from the panel discussions and the range of themes discussed in the literature review, the following recommendations and outcomes from good practice across Luxembourg firms can be identified.

Key messages

1. It is important to have competent and talented people regardless of gender and this should lead the search for professionals.

2. Diversity has multiple facets, such as cultural and age diversity and all of them are important.

3. Policies must not only be fair in terms of giving equal opportunities, no matter the gender, but also promote a gender-friendly environment that enables women to be attracted to that sector.

4. Women should let their employers know that they are ready for promo-tion and organizations should actively seek out candidates with the right skills for promotion.

5. To change the level of gender diversity awareness, the head of the business must understand and support the concept of diversity.

6. The impact of diversity interventions must be consistently tracked and objectively measured and, additionally, tied with management com-pensation.

7. Governments might contribute with tools other than quotas: reason-able maternity and paternity leave, a school system that allows par-ents to have both paid jobs and subsided or tax-deductible child care.

3. What are the good practices and organiza-

tional solutions that help to

change mindsets regarding gender

diversity?

Résumé analytique

La diversité des genres est un thème qui gagne en importance et qui est abordé partout dans le monde et dans des contextes divers. Les gouver-nements nationaux ainsi que les organisations privées mènent sans cesse des études sur la diversité des genres afin d’analyser la situation dans les différents pays et de proposer des recommandations en vue de parvenir à un répartition équilibrée entre les hommes et les femmes sur le lieu de travail. La Fedil en collaboration scientifique avec l’Université du Luxem-bourg et avec le soutien du ministère de l’Egalité des chances a organisé une série de conférences sur la diversité des genres dans l’économie luxembourgeoise afin d’éveiller les consciences, de stimuler le débat et de sensibiliser les milieux concernés à la problématique la diversité genres dans les politiques des entreprises et du gouvernement. Les objectifs des conférences étaient les suivants :

1. Informer sur la situation en matière de diversité des genres au Luxembourg.2. Débattre des enjeux fondamentaux de la diversité des genres.3. Partager les bonnes pratiques en vigueur et définir des moyens pour mettre en œuvre des solutions originales qui contribuent à changer les mentalités à l’égard de la diversité des genres.

La première conférence a servi de séance d’introduction et de partage d’informations, lors de laquelle les aspects généraux de la diversité des genres ont été abordés. Les participants ont, en outre, présenté leurs expériences et points de vue sur le comportement des femmes occupant des postes à responsabilités au sein d’une entreprise. Lors de la deuxième conférence, la discussion a essentiellement porté sur le thème des « performances financières des entreprises ». En matière de diversité des genres, il est important d’examiner les performances afin d’évaluer si la présence des femmes dans les entreprises en général et dans les conseils d’administration en particulier apporte une valeur ajou-tée aux performances compétitive et financières des entreprises. Lors de la troisième conférence l’attention s’est portée sur les pratiques et les politiques en matière de ressources humaines jouant un rôle dans l’amé-lioration de la diversité des genres. La quatrième conférence, analysait les effets de la diversité des genres sur la réputation extérieure d’une entreprise, son approche commerciale et en matière de la responsabilité sociale des entreprises. Au total, 31 orateurs ont contribué au cycle de conférence, qui a accueilli plus de 300 participants, dont 40% d’hommes. Les orateurs provenaient de nombreux secteurs, tels que le secteur public, le secteur financier, les médias et les télécommunications l’industrie des boissons, l’industrie automobile et la construction.

Sensibiliser le public au sujet de la diversité des genres en

entreprise: quatre conférences au

Luxembourg

Les sections suivantes, reprennent les enseignements des quatre confé-rences, ainsi que dans des rapports et ouvrages clés à ce sujet.

La diversité des genres dans l’environnement de travail et, en particulier, dans les conseils d’administration, reste un enjeu et un défi important pour les entreprises luxembourgeoises. En dépit du fait qu’en 2011, les femmes représentaient 50,3% de la population luxembourgeoise totale (STATEC, 2011) et 51,4% des étudiants de l’université du Luxembourg, elles restent sous-représentées aux postes à haute responsabilité. Un signe positif, cependant, est que le taux d’emploi féminin a augmenté ces dix dernières années, de 55,1% en 2003 à 62% en 2010. La proportion de femmes qui travaillent à temps partiel reste toutefois plus élevée que dans les pays voisins.

Si l’on se tourne vers les postes de direction, la présence des femmes est encore plus faible. Au Luxembourg, les femmes ne représentent que 6% des membres des organes de décision supérieurs (présidents et membres du conseil d’administration) et celles-ci ont tendance à être d’origine étran-gère (Eurostat 2011, European board diversity analysis 2010). C’est la preuve que la diversité culturelle est bien développée au Luxembourg. En matière de diversité des genres, cependant, le Luxembourg a encore des progrès à accomplir.

Un signe positif, cependant, est que la diversité est déjà fortement vi-sible dans les missions et les pratiques opérationnelles de nombreuses entreprises luxembourgeoises. Ainsi, les résultats d’une enquête menée par la Fedil auprès de ses membres indiquent que près de la moitié des entreprises participant à l’enquête (43,15%) déclarent être sensibles à la diversité, même si les programmes formels restent rares. La majorité des entreprises (78,62%) n’ont pas de politiques de promotion des femmes à des postes supérieurs et seuls 14,58% d’entre elles ont confirmé l’exis-tence de programmes de sensibilisation. Une note plus positive : l’enquête indique aussi la volonté et l’engagement de la majorité (80,71%) des entre-prises de mettre en œuvre des programmes de formation en vue d’encou-rager les femmes à faire carrière.

1. Quelle est la situation en matière

de diversité des genres au Luxembourg ?


Des quotas ou non ?

Une question centrale liée à la diversité des genres, en particulier à la présence des femmes à des postes de cadres supérieurs, concerne l’uti-lisation de quotas qui imposent légalement les proportions de femmes à des postes haut placés. Les fondements de telles réglementations varient fortement d’un pays à l’autre ainsi que d’un gouvernement à l’autre. Cer-tains pays ont décidé d’adopter des quotas légaux assortis de sanctions (France, Italie et Belgique). Il existe d’autres mécanismes, tels que « se conformer ou s’expliquer » (Pays-Bas), des règles s’appliquant uniquement aux entreprises publiques (Danemark, Finlande, Grèce, Autriche, Slovénie), les objectifs facultatifs nationaux (Royaume-Uni) et les chartes auxquelles les entreprises peuvent adhérer (Pays-Bas, Danemark). Les entreprises et les gouvernements d’autres pays qui sont encore indécis se livrent à de vastes débats sur les « pour » et les « contre » de l’utilisation/adoption de quotas légaux. Un argument récurrent contre les mesures législatives est que le système de quotas ne s’applique pas aux autres niveaux de l’entreprise, notamment à la représentation des femmes dans la direction. Ces quotas ne répondent donc pas à la nécessité d’accroître la présence de femmes à tous les échelons de la structure organisationnelle (OCDE, 2011 ; McKinsey, 2012).

En outre, les gouvernements disposent aussi d’autres outils que l’introduc-tion légale de quotas de femmes pour favoriser la présence des femmes sur le lieu de travail. The Economist (2011) et McKinsey&Company (2012) en ont identifié les principaux : un congé de maternité et de paternité raisonnable, un système scolaire qui permet aux deux parents d’avoir à la fois un emploi rémunéré tout en bénéficiant de services de garde d’enfants subventionnés et fiscalement déductibles.

Quant au Luxembourg, la présence des femmes dans les conseils d’admi-nistration mérite d’être développée. Malgré cela, tous les participants aux conférences sur la diversité des genres, quel que soit leur sexe, n’approu-vaient pas le besoin d’imposer aux entreprises à travers de quotas légaux de nommer des femmes dans les conseils d’administration. Une des expli-cations avancées par les participantes est que les femmes refusent d’être

2. Quels sont les enjeux

fondamentaux de la diversité

des genres ?

20 Résumé analytique

nommées à des postes haut placés uniquement en raison des quotas; elles préféreraient être nommées pour leurs compétences et leur talent et parce qu’elles méritent le poste. En outre, tous les orateurs ont indiqué clairement que lorsqu’il s’agissait d’engager de nouveaux employés et de nommer des membres du conseil d’administration, le critère le plus impor-tant était la compétence.

Ce point de vue était également celui des représentants des secteurs qui, traditionnellement, sont davantage dominés par les hommes, tels que les entreprises technologiques, la construction et l’industrie automo-bile. À cet égard, il est important rendre ces secteurs plus attractifs pour certaines catégories personnes (formes de travail plus flexibles, un plus grand soutien dans l’exécution du travail) et de changer les mentalités des jeunes en leur offrant davantage d’informations et des choix de carrière plus vastes. L’accès des femmes à l’enseignement supérieur dans des domaines tels que l’ingénierie et la gestion de l’entreprise, notamment, doit être amélioré, tout comme l’accès aux à la recherche de talents dans ces domaines. Cependant, pour changer les mentalités et les stéréotypes, il faut commencer dès l’enfance.

De nombreux orateurs ont aussi indiqué qu’un des principaux obstacles à la diversité des genres dans l’emploi mais en particulier en matière de promotion est que, souvent, les femmes ne se projettent pas et sous-estiment les compétences qu’elles ont à offrir. Ils ont fait observer que les hommes, en général, hésitaient moins à s’évaluer ou à se mettre en valeur et qu’ils avançaient plus rapidement dans leur carrière que les femmes, qui ont tendance à gravir progressivement tous les échelons de l’entreprise. Un plus grand estime et la reconnaissance des compétences que les femmes apportent peuvent donc jouer un rôle important dans la transformation des mentalités figées et d’aider les recruteurs à apprécier les CV hors normes et l’éventail d’expériences qu’une personne peut offrir. Les entreprises devraient aussi cibler activement les femmes au sein de leur structures, éventuellement certaines de leurs employées, qui pos-sèdent les compétences et l’expérience adéquates, afin de discuter de leurs intentions en matière de promotion et de responsabilités accrues.


Les femmes dans les conseils d’administration et les performances organisationnelles

Les résultats d’études menées dans d’autres pays et par d’autres organisa-tions sont très contradictoires concernant la manière dont la participation des femmes aux conseils d’administration contribue à accroître les per-formances financières des entreprises. A titre d’exemple, les résultats de l’étude sur les institutions financières allemandes menée par la Deutsche Bundesbank indiquent que la prise de risques s’accroît avec la présence des femmes au conseil d’administration, mais seulement après trois ans de participation et avec pour résultat économique marginal uniquement. Cependant, d’autres études affirment que les entreprises comptant trois femmes ou plus à des postes de cadres supérieurs obtiennent de meil-leurs résultats dans tous les critères de performance organisationnelle et de performance financière. Elles indiquent aussi que les entreprises qui comptent moins de trois femmes à des postes de cadres supérieurs ne réalisent pas de performances financières fondamentalement différentes. Il est, par conséquent, difficile d’apporter la preuve statistique du lien direct de cause à effet entre la présence de femmes à des postes de cadres supérieurs et les performances financières de l’entreprise.

Dans le cas du Luxembourg, c’est encore plus difficile à évaluer parce que seule une entreprise sur un échantillon de conseils d’administration d’entreprises cotées en bourse ayant leur siège au Luxembourg comptait plus de trois femmes dans son conseil, et ce, seulement depuis 2009. Il est donc trop tôt pour évaluer tout lien direct de cause à effet entre la présence des femmes aux conseils d’administration et les performances financières des entreprises luxembourgeoises. L’étude de la Fedil a cepen-dant mis en évidence que les entreprises qui comptaient des femmes dans leurs conseils d’administration étaient, en moyenne, des entreprises plus grandes et plus jeunes que les autres. La raison pourrait en être que les entreprises plus jeunes ne sont pas aussi traditionnelles et sont donc moins influencées par les stéréotypes.

Les résultats des études sont donc très contradictoires sur ce point, et trouver une relation positive ou négative n’est pas nécessairement le signe d’un lien de cause à effet. Il se peut que les femmes sont à l’origine des meilleures performances. En même temps les entreprises qui réalisent de meilleures performances ont tendance à promouvoir davantage de femmes. L’important est donc de reconnaître la diversité des genres en

tant que telle plutôt que de promouvoir des femmes ou des hommes au conseil d’administration simplement en vue d’améliorer les performances financières. Plus le conseil d’administration et les travaux du conseil sont efficaces, plus l’entreprise est susceptible de connaître du succès. Ce qui est très important, c’est donc le choix dans la composition du conseil, la manière dont les compétences et les aptitudes sont combinées et l’accès des membres à des informations et à des ressources critiques. Ce point a été repris par de nombreux orateurs lors des conférences.

La diversité des genres et la fonction de gestion des ressources humaines

e orientation dominante relative à la diversité vue sous l’angle des res-sources humaines repose sur le principe d’égalité des chances, qui est axé sur l’égalité et un traitement équitable. Cette approche se base tou-tefois sur une orientation exclusivement collective visant le traitement de chaque individu comme une part égale d’un grand ensemble, plutôt que d’encourager une valorisation des différences personnelles.

La gestion de la diversité, en revanche, se concentre sur les forces spé-cifiques des personnes tout en donnant à chacun une chance égale. Les attitudes liées aux enjeux de la diversité dans les entreprises ne sont pas caractérisées par l’uniformité et la clarté, mais par une variété de concep-tions et d’applications. Une main-d’œuvre diversifiée n’implique pas seule-ment une simple augmentation des chiffres de la représentation des races, des cultures, des genres ou des classes, mais elle admet également une combinaison de convictions, perspectives, conceptions multiples que les membres de divers groupes apportent à une entreprise. La gestion de la diversité nécessite par conséquent une approche stratégique et globale qui montre que l’entreprise comprend clairement sa diversité et qu’elle en assure la continuité au moyen de l’introduction de pratiques et d’une culture dans son organisation. Les éléments fondamentaux et essentiels sont l’engagement de la direction ainsi que l’acceptation culturelle et l’inté-gration de programmes.

Pour changer la situation en matière de diversité des genres, les entre-prises doivent modifier leur culture d’entreprise et agir sur toutes les di-mensions de l’entreprise. Il est important que la conviction atteigne toutes les couches de l’organisation. Il est aussi crucial que le chef d’entreprise

comprenne la notion de diversité. On ne peut pas forcer les entreprises à mettre la diversité des genres en œuvre, elles doivent être convaincues et penser que c’est une bonne chose. Cela demande un changement dans nos mentalités et modes de reflexions traditionnels

Les effets positifs de la diversité des genres sur la réputation et l’orientation de marché des entreprises

Comme énoncé ci-dessus au sujet des performances financières, un ac-croissement de la diversité des genres dans les conseils d’administration pourrait avoir un effet positif sur la réputation des entreprises. Des études étayent les arguments selon lesquels la diversité des genres dans les conseils d’administration pourrait développer les pratiques de responsa-bilité sociale des entreprises (RSE). Cela est en partie dû au fait que les femmes apporteraient une sensibilité accrue à la RSE et un style de prise de décision participatif, ce qui contribuerait positivement à la réputation de l’entreprise. Avoir une bonne réputation en matière de gestion de la diversité et être reconnu à cet égard comme chef d’entreprise pourraient être interprétés positivement par les investisseurs et pourraient améliorer les appréciations et, en conséquence, les performances financières. Par exemple, 70% des répondants dans le cadre d’une étude menée par la Commission européenne (2003) affirmaient que les initiatives de sensibi-lisation à la diversité amélioraient la réputation des entreprises. D’autres études indiquent aussi une relation positive entre le comportement éthique des entreprises et la présence des femmes aux conseils d’administration.

Les études mettent aussi en évidence l’amélioration de l’accès à de nou-veaux segments de marché après la mise en œuvre d’un programme de gestion de la diversité. Les femmes seraient le segment d’acheteurs qui connaît la croissance la plus rapide. En Europe et en Amérique, les femmes sont responsables d’environ 70% de l’ensemble des achats du foyer et prennent 80% de toutes les décisions relatives aux produits de consom-mation. Lorsque des femmes figurent dans les conseils d’administration, elles apporteraient donc des expériences et des éclairages précieux quant au comportement et aux décisions d’achat des consommateurs.


Introduction

Despite the fact that women constitute nearly half of the adult workforce and new university graduates in the EU, they are still under-represented in decision-making processes and positions.

The reasons to understand and justify such a context have been the sub-ject of many studies and analyses. This report will address the issue of underrepresentation in senior management by covering the key themes be-ing discussed in the current academic and business literature. In addition, the main themes presented during the four conferences under the theme Gender Diversity and organized by Fedil, that took place between March and June of 2012, will be introduced.

In particular, this study provides an insight into the gender diversity situa-tion in Luxembourg - a country which has been under-researched with re-spect to the division of labour between genders and gender role attitudes.

The report is structured as follows: The first section establishes the current ‘state of play’ with regard to the participation of women in employment and in leadership positions in Luxembourg compared to other European countries. This section also discusses the effect of education and career options on female participation in the work place. Following this, the report is divided into four chapters. For each chapter, there is a combination of literature reviewing and “good practice” information outlined during each conference with a summary of the main themes discussed, as well the speaker and panelists’ contributions. Specifically, the first chapter provides an overview of women and family roles in gender diversity. The second chapter exam-ines the effect of gender diversity on a company’s economic performance. The outcome of an empirical analysis of Luxembourgish quoted companies is also presented, where the link between women on the board of direc-tors and performance is analyzed. The third section traces the role and meaning of diversity management policies in relation to human resources policies. The final chapter considers the link between diversity practices and the corporate image or marketing orientation of organizations. Lastly, the main findings of the paper are summarized.

Gender Diversity in the Luxembourg Context: The Current State of Play

It was stated in many reports such as McKinsey & Company (2012) and the European Commission (2005) that gender inequality is observed in various domains: in political and economic life as well as in the private and public sectors. The influence of cultural and socioeconomic factors on the representation of women in management is significant. It is important, therefore, to understand the context which facilitates women’s career op-portunities in Luxembourg.

Female employment and part-time work in Luxembourg

Women represent 50,25% of the total population in Luxembourg and re-cent statistics (STATEC, 2011a) show an increase in the female employ-ment rate in Luxembourg during the last decade. This suggests that some of the barriers preventing women from joining the labour market are being overcome as more women are now actively involved in labour market activi-ties (Valentova, 2012). The gender gap in the employment rate 1 (Exhibit 1), however, remains the highest among the neighbouring countries – a figure that is significantly above EU-27 levels (Eurostat, 2011).

1 The gender gap is calculated as the difference between male and female employment rates (persons aged 15 to 64 employes as percentage of the total population of the same age). A positive gap indicates how much higher the employment rate is for men than women.


LuxembourgBelgiumFrance

GermanyEU-27

Age-group15-64

Exhibit 1: Gender Gap in employment rate 2011Source: Eurostat, 2011

15,2%

10,4%

8,4%9,6%

11,6%

Furthermore, the proportion of women in part-time jobs is higher in Lux-embourg than in several of the EU member states (STATEC, 2011b). The reasons do not seem to relate directly to the difficulty of finding full-time jobs as is the case in many of the other European countries, but to the personal choice of women who prefer working reduced hours in order to cope with the assistance to children, elderly relatives and other family or personal responsibilities. In the financial sector, which represents a sub-stantial proportion of total employment in Luxembourg, a survey among the banks conducted by the ABBL, Luxembourg’s Bankers Association shows an equitable balance in terms of the male and female proportion of staff, with almost one fifth of the women working as part-time employees against only 1,71% of men (ABBL, 2012). The balanced proportion in total staff, however, is not reflected on higher organizational levels, where women represent 22,29% of Senior Executives, 13,07% on Executive Committee and 15,63% on Boards of Directors.

Regarding employment in the public sector in Luxembourg, some evidence indicates that this is an environment where female employment is higher. According to OECD (2011), the share of women in the public sector is nor-mally higher than their share in total employment in the country, as it nor-mally offers better pay, conditions and promotion prospects than private industry (The Economist, 2011).In Luxembourg, according to data provided by the Ministère de la Fonction Publique (Department of Civil Service and Administrative Reform, 2011) represented below in Exhibit 2, women are also the majority in the Judiciary and Education sectors. In general admin-istration, they are heavily concentrated in the health sector. Regarding senior management positions, female participation in the public sector Luxembourg falls to nearly 20%, which is not a very impressive proportion, although it is higher than the percentage of women with managerial func-tions in the private sector in the country.

Exhibit 2: Share of women and men in public sector staff

Categories Total employees

% Male % Female %

General Administration

5508 100 3772 68,9 1736 31,1

Judiciary 503 100 216 43,7 287 56,3

Enforcement officials

2157 100 1932 89,7 225 10,3

Education 8230 100,54 2925 36,2 5305 63,8

Management functions

Male % Female %

Level 1 83 17

Level 2 86 14

The statistics also demonstrate the link between educational level and employment rate (STATEC, 2011b). The employment rate for those with tertiary education is not only significantly higher (83,6%, against 67,3% for those with secondary education and 58,5% with low education) but is has also increased during the last decade. Although female employment is lower than male employment at all educational levels, the gap is lower for people with a higher educational level (12,3%). This leads inevitably to a discussion about the influence of academic choices and career fields on women’s participation in business contexts. It has been argued that women concentrate heavily on subjects that separate them from men, mostly due to stereotyped choices of education (Lejealle, 2011). In devel-oped countries, for example, women hold more than 70% of the academic degrees in the humanities and health subject areas, while the majority of degrees in engineering are held by men (The Economist, 2011). Lejealle (2011) concludes that girls choose less often than boys, occupations and industry types where the majority of management positions are generated or demanded, e.g. technology-based companies. In general MBA courses, which are seen as a classical step on the pathway towards management careers, women account for only 30% of the students.

Source: Ministère de la Fonction Publique, 2011


This situation is also reflected in the student body of the University of Lux-embourg, where women are equally represented (Exhibit 3), but they are mainly concentrated in the faculty of Language, Literature, Humanities, Art and Education (Exhibit 4), where they are twice as numerous as men. In addition, female students are represented fairly similarly in the faculty of Law, Economics and Finance but are significantly underrepresented on the Faculty of Science, Technology and Communication (University of Luxem-bourg Annual Report, 2010). Such disparities, however, cannot be simply explained by gender differences in abilities or skill level but to subject and career choices made in early life, which are shaped by stereotypes embed-ded in society (The Economist, 2011).

Female participation in business management in Luxembourg

When the focus is turned to management positions, female participation is much lower than men’s. A European Commission study on gender equality (2010a) states that considering directors, chief executives and managers of small enterprises, the gender gap is even more evident in Luxembourg. For example, whilst the average of the 27-EU Member States is 33%, the percentage of women in Luxembourg who occupy a leadership position is 22%. This demonstrates an overrepresentation of men as business lead-ers, as evidenced by a gap of 56% against 34% of EU-27 (Exhibit 5).

2 FLSHASE - Faculty of Language, Literature, Humanities, Art and Education FDED - Faculty of Law, Economics and Finance FSTC - Faculty of Science, Technology and Communication

WomenMen

Source:University of Luxembourg

Annual Report, 2010

Exhibit 3: Gender breakdown of students at the University of Luxembourg

08/09 winter 08/09 summer 09/10 winter 09/10 summer 10/11 winter

2253 22642054 1989

2478 24562307

2190

26602517

Faculty FLSHASEFaculty FSTCFaculty FDEF

MenWomen

Exhibit 4: Students at the University of Luxembourg Breakdown per gender and faculty2

Source:University of Luxembourg

Annual Report, 2010

21%

36%

67% 70%

49%51%

30%

43%

33%

Winter10/11


A recent study conducted in Luxembourg by local institutions (Lejealle, 2011), provided more details on the distribution of business leaders, iden-tifying the participation of women per activity sector and company size (Ex-hibit 6). The comparison with previous years shows a very slight advance in total participation of women in management (35% in 2003 to 36% in 2011) and on executive boards (16% in 2003 to 20% in 2011). Analyzing the breakdown per sector, it is not possible to draw a direct association between participation in total staff and representation on boards. The sectors related to finance, for example, show a gender balanced staff (45%), but a very low number of women on boards (8%). On the other side, industry and construction, where women are generally underrepresented, show a share of women on boards which is at least equal to the numbers of total staff. Conversely, areas with an overrepresentation of women, such as Banking and Finance (47%) and Services/Education (56%), show a sharp deficit of women on boards (10% and 24%, respectively). Regarding companies ‘size, women participation is more significant on boards of very small companies, where they account for 23%.

Exhibit 6: Female participation on executive boards by activity sector and size

Activity sector % percentage of women 2000

% percentage of women 2003

% percentage of women 2011

in total staff

on Board of Directors

in total staff


in total staff


Industry 15 18 21 10 20 15

Construction 6 15 6 20 8 27

Automotive busines and repair 22 16 35 22 29 24

Retailing, hotels, restaurantes and cofee establishments

58 24 63 30 57 30

Financial intermediation, insur-ance, financial assistance

45 8 45 5 47 10

Real state, R & D/consultancy services, Recreational, cultural and sport activities, Waste man-agement, Education, Health and Social, personal services

51 23 55 21 56 24

Transportation, Post and Tel-ecommunications, IT

20 12 19 13 20 21

8230 100,54 2925 36,2 5305 63,8

1-14 employees 38 20 42 18 43 23

15-49 emoloyees 30 15 30 13 30 17

50-99 employess 28 4 25 11 31 15

more than 100 employees 34 9 37 10 38 12

Total 33 16 35 16 36 20

The presence of women on boards of directors in quoted companies is one of the most recurrent themes in gender diversity discussions, aca-demic studies and business reports. Despite recent statistics that show an improvement in the numbers in some countries, female representation is still very low. In Luxembourg, women represent only 6% of the highest decision making body (Chairman and members of the board of directors) and they are mainly non-nationals (Eurostat, 2011; Egon Zehnder Interna-tional, 2010).

Source: Lejealle, B. (2011/based on Enquêtes Femmes dans la prise de

décision 2000, 2003 et 2011 – Ministère de l’Egalité des chances – CEPS/INSTEAD

– Chambre de Commerce – Chambre des Métiers)

3 Leaders of business covers ISCO (International Standard Classification of Occupations) categories 121 (Directors and chief executives) and 13 (Managers of small enterprises)

WomenMen

Source: European Commission(2010a/based on Eurostat,

Labour Force Survey)3

Exhibit 5: Sex distribution of leaders of businesses

0 10 20 30 40 50 60 70 80 90 100

Luxembourg

EU-27 33

22

67

78


Exhibit 7 shows the percentage of men and women on the boards of direc-tors in large companies per country and the respective share of women in employment and in tertiary education.

The current proportion of women on boards has encouraged the Euro-pean Commission and several countries to adopt initiatives to promote a more balanced leadership in corporate boards of listed companies (Euro-pean Commission, 2012b). Legislative measures have been adopted by France, Italy and Belgium, which include sanctions to be applied in case of non-compliance. The Netherlands and Spain also approved legislative measures without any significant punitive measure. In other countries such as Denmark and Greece, governments opted for equality rules concern-ing state-controlled companies. A recurring argument against legislative measures as highlighted in McKinsey & Company report (2012), lies in the fact that the quotas system does not address other levels within the organization, including the female representation in Executive Committees (OECD, 2011) and therefore, such quotas do not cover the need to in-crease representation along the entire organizational hierarchy.

4 Data on share of employment not available for RS; data on tertiary education not available for LU, EL and RS

On the other hand, a great number of voluntary initiatives have been cre-ated by companies, institutions and associations. This non-compulsory approach is aligned with public opinion identified on in survey conducted by European Commission (2012a). In the EU27, 51% of respondents con-sider self-regulation by companies setting their own targets and voluntary measures, such as non-binding Corporate Governance Codes, as the best ways to achieve a more gender balanced participation on boards. When explicitly asked to opine about the adoption of legal measures, 25% of the respondents in Luxembourg pronounced themselves as “total opposed”.

Fedil Survey

A survey was conducted by Fedil (2011) to identify the current state of play with regard to the presence of women in economic decision-making in Lux-embourg businesses. A questionnaire was sent to all 517 Fedil members to identify the proportion of women at each organizational level. The num-ber of companies which responded to the survey was 147, representing a 28, 43% response rate.

Exhibit 8: Participation of women and men per organizational level

Companies Total Staff Middle Management Senior Management

Total Total Women Men Total Women Men Total Women Men

147 35.285 9.326 25.959 3.140 756 2.384 620 107 513

in % 100% 26,43% 73,57% 100% 24,08% 75,92% 100% 17,26% 82,74%

The findings, presented in Exhibit 8 show that only 26,4% of total staff is constituted by women. This is a consequence of Fedil members’ sectors of activity, which are more concentrated in manufacturing and construction (areas traditionally occupied by men). The female participation decreases dramatically as they move towards senior management positions (17,2%) and board of directors (10,34%), reflecting the trend presented earlier in this section.

Source: Fedil, 2011

WomenMen

Source: European Commission

(2012b/based on Database on women

and men in decision-making

and Eurostat, Labour Force Survey)4

Exhibit 7: Women and Men on the boards of the largest listed companies, January 2012

%

20

40

60

80

100

FranceNetherlandsGermanyEU-27BelgiumLuxembourg


The survey additionally intended to identify whether any action has been taken by the companies to manage diversity and the kinds of policies adopted. The responses, grouped accordingly to six thematic questions, are outlined in Exhibit 9 below.

Exhibit 9: Identification of gender diversity policies

1) Existence of a particular

attention to diversity in the

company

2) Existence of a an awareness

program on hiring and promoting

minorities

3) Actions in place to

discuss gender stereotypes and

questions

4) Implemented policies of

female promotion

5) Willingness to implement

female promotion policies

6) Willingness and capabil-

ity to implement training mentor-

ing programs for women

Yes No Yes No Yes No Yes No Yes No Yes No

43,15% 56,85% 14,58% 85,42% 22,76% 77,24% 21,38% 78,62% 69,57% 30,43% 80,71% 19,29%

The results show that diversity is already an issue for almost half of the participant companies in the survey (43,15%), but actions and formal pro-grams are still rather rare. The majority of the organizations (78,62%) do not have policies for female promotion and only 14,58% confirmed the existence of ‘awareness’ programs. The majority (80,71%) did affirm, how-ever, a willingness and capability for implementing training and mentoring programs to foster female careers.

In the next sections of the report, a presentation of the format, content and discussion of the four conferences is outlined. This analysis provides important contextual data and case study details about the specifics of the Luxembourg situation, in order to enrich the numerical analysis given above.

Source: Fedil (2011)


The first conference, held on 13th March 2012, was concerned with the meanings, perceptions and applications of gender diversity in Luxembourg. Its main purpose was to give an overview of the situation in Luxembourg in comparison with other European coun-tries and to provide a context for the later thematic conferences.

To put gender diversity into context for Luxembourg, a roundtable was composed including prominent business people from Luxem-bourg’s industry. Mrs. Michele Detaille, took on the moderator role of the roundtable and she initiated discussion on 3 main topics: “It’s a men’s world”; the “behavior of women with power and responsibility” and “other experiences, problems and solutions”. The final word on this conference belonged to the important guest, Françoise Hetto-Gaasch, Minister of Equal Opportunities, who co-operates with Fedil concerning gender diversity in Luxembourg and the development of this report. The speakers’ main thoughts are summarized in the following section.

To introduce the situation in Europe, the key findings and conclu-sions of a well-known European report from McKinsey & Company was presented by Mrs. Sandra Sancier-Sultan, co-author of some of McKinsey’s reports.

Sandra Sancier-Sultan – Principal, McKinsey & Company

Michèle Detaille – Managing Director, No-Nail Boxes S.A. Guy Wagner – Ministère de la Fonction publique (public sector)Fabienne Dasnoy – Diversity Officer, BGL BNP Paribas S.A.Romain Mannelli – Executive Vice President Corporate Human Resources, RTL Group S.A.Betty Fontaine – Associate Director-General, Brasserie SimonLydie Bauler – Manager and Leader developer, Delphi Automotive Systems Luxembourg S.A.Dominique Schmidt – Human Resource manager, Soludec S.A.

Keynote Speaker

Moderator of panelists

Panelists

First Conference13th March 2012

Definition

Diversity means differences which can be related to many spheres of which gender is one. Erhard et al. (2003) divides diversity into observable and non-observable processes. Observable diversity relates to physiological characteristics such as gender, race, eth-nicity and age; and non-observable diversity refers to knowledge, skills, personality, perspectives and background of people.

However, it should be noted that gender is a historical and social construct; it therefore changes, evolves and transforms over time. In the case of this report the following definition of gender diver-sity is adopted: (Walter, 2008, p.7-8):

“Gender refers to socially and culturally dominated gender roles. Gender diversity includes the further differentiation including age, ethnicity, physical ability, sexual orientation, class, etc. which are also social constructs and therefore changeable.”

“Gender diversity means considering and promoting the different skills, resources and potential of women and men as equivalent in their diversity.”

Gender diversity


Mrs. Hetto-Gaasch raised an unanswered question which was whether it is really true that women do not have the characteristics and suitable requirements for executive positions. This perception comes with stereo-types which appear time and time again and have the effect of disquali-fying women. She stated that we should talk about positive things, not about negative ones. Gender diversity is an asset for every company. The Government must make an effort, especially on the management of the public sector. We have to be open-minded and change our thinking. Mrs. Hetto-Gaasch commented that: “Nature created differences and society turns them into equality.”

Mrs. Sancier-Sultan stated that European countries start to consider gen-der diversity as a strategic priority. Nevertheless, the survey by McKinsey & Company concluded that some companies are doing a lot but unfortunately achieving limited results. She reported that: “sometimes even sustainable efforts do not have significant outcomes”.

According to Mrs. Sancier-Sultan, the biggest gap lies in the culture of a company. To change the situation, companies need to change their corpo-rate culture and work on all the dimensions of the company. It is important that this belief reaches all the layers within the organization. To make a change we have to work on our mindsets and change our thinking.

Mrs. Francoise Hetto-Gaasch Ministrer for Equal Opportunities

Mrs. Sandra Sancier-Sultan McKinsey & Company

The speakers’ main thoughts

40 First Conference

She continued: Top management is a world created by men. Women need to be taught how to work in this environment. On the other side, men need to be taught as well, because they do not know how to manage women. They are afraid to criticize them, because they do not know how to handle their emotions. Men do not give women the feedback necessary for im-proving; women do not know if they are performing well or not. They need to be taught how to handle the behavior of the opposite gender and be encouraged to talk to women and not be afraid of reactions.

Finally, she reports that: “We need to lead by example to convince people. We should use examples, figures and training to prove that gender diversity is an asset”.

Mrs. Detaille presented statistics regarding the current situation in Luxem-bourg, such as the proportion of women on Boards and in education (which are described in the previous chapter “Gender Diversity in Luxembourg Context: the Current State of Play”). She then moderated the panel discus-sion, which revolved around three main topics: the position of women in the “men’s world”, behavior of women with power and responsibilities and panelists own experiences.

Mr. Mannelli reported that RTL Group is not just a man’s world. They have 46% female employees and 20% of the top management positions are held by women. In the near future they plan to appoint a woman from Germany as CEO of the company. Further proof that gender diversity is important for RTL is that departments led by women are performing very well (i.e. 54% of EBITDA comes from these departments).

To reach the current level of gender diversity, RTL Group is providing train-ing and they do not have any discrimination in wages. Their objective is to choose the most relevant people for the job without considering what gender they are.

Mrs. Michèle Detaille No-Nail Boxes

Mr. Romain Mannelli RTL Group

Mr. Wagner stated that more women than men are applying for jobs in the public sector. He highlighted some statistics about women in this sector, which were summarized in the previous chapter of this report: “Gender diversity in the Luxembourg context: the current state of play”. The main outcomes were for instance the difference between the proportion of wom-en in technology services, with 16% of women, and health services with 63,7% of women. In spite of the fact that more women apply for a job in the public sector, there are only 22,5% of women in managerial positions.

Delphi Automotive Systems belongs to the car industry sector, which is traditionally a “man’s world”. They have 12% female employees. In their view, they do not have enough women interested in this industry. Mrs. Bauler argued that it is difficult to attract women. Delphi Automotive is trying to improve the situation by organizing internships and training for women. However, the problem is not just the low interest of women, but families are also crucial. Families do not always support daughters to study programs which are needed for this kind of industry. They do not lead them this way. They have a significant role to play in encouraging their daughters to enter this industry.

Mr. Guy Wagner Ministère de la Fonction Publique

Mrs. Lydia Bauler Delphi Automotive Systems Luxembourg

42 First Conference

BGL BNP Paribas is the first employer in the financial sector in the country and the second largest employer from the private sector. They have ap-proximately 4000 employees with 48% of women, 26% of women in middle management and 16% of women in top management (Exhibit 10).

In 2011, in a post merger context, the group defined its 4 management principles. One of them is to “valorise people”. This principle includes gender diversity and thus, in order to move forward, BNP Paribas created a position responsible for diversity. It has the mission to promote diversity in every sense and set priorities in two axis: gender and age. An action plan was defined to be conducted in 5 stages: Audit and monitor, educate and empower decision makers, train and inform the actors, act concretely within the company and each positively on the external environment. This action plan will be implemented similarly as any other business project, that is to say, with a business case, retro planning, resources, objectives and measurement indicators.

Mrs. Dasnoy stated that she has been working on gender equality matters for a considerable time and that a program previously implemented was a failure. Her opinion is that to work only on gender is a mistake. She says:

“We have to think about men as well. We cannot treat women like victims. To achieve diversity, we must work together properly. We should speak business and not to be protecting someone”.

Mrs. Fabienne Dasnoy BGL BNP Paribas

10% 20 30 40 50 60 70 80 90

Parental vocations in 20102,2% total

Part-time23% total

Top management3% total

Middle management23% total

Contract employees74% total

Total employees100% total

Source: Dasnoy, 2012

Women Men

Exhibit 10: Gender diversity in BNP ParibasSituation 12/2010

Mrs. Schmidt argued that the issue is not that women are a problem but that they are a solution. She used the analogy of delivering a baby which is a process that cannot be delegated! As with motherhood, this should be seen as a source of “power” and not as a weakness. Women need to stop undervaluing themselves. It is no longer a men’s world; we now live in a women’s world.

To change the level of gender diversity in the company, the head of the business must understand the concept of diversity. Companies cannot be forced to have gender diversity, they have to be convinced and believe that it is a good thing.

Mrs. Fontaine stated that women often have a tendency to “wait in the corner” to be noticed and often people are not aware that they want to achieve a higher position in their career. Often women are just waiting until their good results attract the attention of their employers and until their employer is ready to help them move higher in their career. In contrast, men do not hesitate to take initiatives, according to Mrs. Fontaine.

Mrs. Fontaine’s advice on how to improve gender equality is that women should advertise themselves more. They should let their employers know that they are ready for promotion. Companies should also actively target women in their organization and discuss with those who have the right skills and experience their intentions for promotion and taking on more responsibilities.

Mrs. Dominique Schmidt Soludec

Mrs. Betty Fontaine Brasserie Simon Exploitation

44 First Conference

The main themes discussed at the conference

Women and family – family role in gender diversity Promoting women – advertisement by womenStereotypes – what disqualifies womenMen’s world – role of men in gender diversity and women in technology industryHow to improve gender diversity – trainings, programs ...

The table above summarizes the main topics that were discussed at the first conference. The most important topics will be further developed in the following section, supported by the main studies, reports, statistics and articles on these topics.

Family and household

Life can be divided in two parts: personal life and work. Personal life in-cludes family, household and free time. Family is one of the most important social and economical institutions which every human is part of. Family provides the necessary background and support in times of stress and difficulties (Catalyst, 2009) but commitments to family duties and respon-sibilities are often difficult to balance with work.

The business world as we know it today is characterised by its absolute availability and geographical mobility at all times. In different words, it can be described as “anytime, anywhere” (McKinsey &Company, 2007, p.9). The individual, who wants to be part of this world and advance to higher positions, has to be flexible and ready to commit to work.

Working time occupies 50% of our time during the working day.5 A study conducted by Hewlett (2002) concluded that for people in higher positions the number of hours worked is even higher. Twenty-nine percent of high achievers and thirty four percent of ultra high achievers work more than 50 hour per week, which means that work occupies 62,5% of their day time. The link between the number of hours worked and the presence of women in the higher positions has been confirmed by McKinsey &Company (2007).

1.2.3.4.

5.

Work occupies 50% of our

working day time.

29% of high achievers and

34% of ultra high achievers work

more than 50 hours per week.

5 Considering full time job (40 hours per week and 8 hours of sleeping).

Interviews made by Stephenson (2004) showed that women as well as men believe that their commitment to work is not reduced by family re-sponsibilities. However, this author together with the other researchers (for example Deepika and Ajeva, 2011), came to different conclusions. They state that women with a family are mostly avoiding staying late at work; they tend not to want to travel in particular for longer periods, and they sometimes miss important training programs which could help them advance in their careers. But this does not necessarily mean that they are less committed to work and that they do not want to do a good job, be successful or advance in their careers. They are just not willing to sacrifice family life for a successful improvement of their careers.

The European Commission (2009, p.4) refers to research conducted by Eurostat (2006), which concluded that “in the EU more than 6 million women in the 25 to 49 age group say they are obliged not to work or to work only part-time, because of their family responsibilities”. Some stud-ies report that children raised by parents who are working late hours and during the weekends have many behavioral problems and do not achieve good school results (Deepika and Ajeva, 2011). This would mean that for the sake of the children it is advisable if one of the parents spends more time with them at the expense of commitment to work. Children are in the most cases still perceived as the primary responsibility of women. This is supported by results of Hewlett (2002, p.68) who concluded that “only 39% of high-achieving men are married to women who are employed full time, and 40% of these spouses earn less than $35 000 a year”.

Many researchers state that family responsibilities, and especially com-mitment to children, are the main obstacles in a women’s career. In a report from the European Commission (2010a), 80% of women reported motherhood as an obstacle to their career. Also, Hewlett (2002) reported that motherhood results in a “penalty” of 7% of earnings for each child.

Hewlett (2002) argues that for the reasons mentioned above, there are more and more women who are becoming mothers later in their life, who do not have children or who have fewer c hildren so they can handle a career at the same time as family commitments. According to Eurostat (2008) the average age of mothers at the birth of their first child is continuously increasing. In 2003 mothers in Europe had their first child at the age of 28 compared to age 26 in 1990. In the 44-55 age range, 49% of the “best paid” women (over 100 000 dollars a year) are childless, compared

In the EU more than 6 million women in the

25 to 49 age group say they are obliged not

to work or to work only part-

time, because of their family

responsibilities.

Motherhood is seen as an obsta-cle to the career

for 80% of women.

In 2003 mothers in Europe had

their first child at the age of 28

compared to age 26 in 1990.

46 First Conference

to 19% of men and only 60% of these high-achieving women are married in comparison with 83% of men(Hewlett, 2002) (see Exhibit 11). Wipper-mann (2010) states that the remaining majority of women, who have more children and earlier in life, are afraid of an increase in work load, which might mean that it is difficult to reconcile job and family.

Children are not the only reason for women’s sacrifice of time. In spite of the fact that men are becoming more and more involved in family life and domestic work, women still spend much more time on tasks such as cleaning, cooking and childcare. Statistical information provided by Euro-stat (2006) indicates that women in France, Belgium, and Denmark spend approximately 80% more time on domestic tasks than men, and 135% more time on childcare. Specifically, women spend about 2 hours more on domestic tasks and 17 minutes more on childcare every day. (Exhibit 12)

Women spend approximately

80% more time on domestic tasks than men and

135% more time on childcare.

Source:Hewlett,

2002

% 10 20 30 40 50 60 70 80 90 100

high-achieving womencorporate women

high-achieving menultra-achieving men

high-achieving womencorporate women

high-achieving menultra-achieving men

Percentage of married professionals at ages 41 to 55

Exhibit 11: Percentage of childless and married professionals Percentage of professionals childless at ages 41 to 55

In conclusion, responsibility to family life is one of the reasons why women are underrepresented in higher positions where larger commitment and time availability is needed. To change the situation, companies should be encouraged to take family needs into account while establishing corporate policy and follow others who already initiated policy developments; i.e. 12% of companies offer paid parenting leave, 31% job sharing, 69% allow stag-gered hours and 48% allow work-at home options (Hewlett, 2002, p.72).

Companies should also support women during their career breaks, includ-ing maternity leave as the largest career break. These breaks should be considered in the beginning to overcome the negative influence on women’s career paths or the salary level. Active management is needed to make sure that women return to their previous work. McKinsey &Company (2007) recommends retaining contacts with women during their break period, to make personal meetings before and after the period with the objective of reintegrating them into the workforce and to be aware of raises in pay and bonuses in the time when women are coming back to the work place.

Twelve percent of the companies offer paid parent-ing leave, 31% job

sparing, 69% allow staged hours and 48% allow work-at

home options.in 1990.

6 Average for Belgium, France and Denmark

48 First Conference

McKinsey &Company (2007) points out that it might not be enough to change the situation with gender equality in the workplace. To make a change we should start at home with our own families and reach equal balance at home. Until we change the perception that women are primarily responsible for taking care of household and family, and that they cannot share men’s role as breadwinners, it will be hard to change the situation in the work environment.

Stereotypes

Stereotypes can be defined as “cognitive shortcuts” or generalizations that we use to make sense of our complex social world. These shortcuts help us differentiate among different groups of people and, in the case of gender stereotypes, between women and men.

Gender stereotypes are widely shared within our culture. This can be prob-lematic as they tend to over-simplify reality, especially when it comes to complex social behaviours. Gender stereotypes emphasize “natural differ-ences” between women and men but the empirical literature tells us that gender differences are far from natural. Through the extensive research on gender differences and similarities, we learn that women and men are actually more similar than different and that there is more variation among women and among men than there is between women and men. By creat-ing false perceptions that women and men are “planets apart,” however, stereotyping results in women being overlooked for top jobs – no matter how strong their actual credentials are (Catalyst, 2007, p.10).

Stereotypes are one of the biggest contributors to the gender gap in higher employment positions. Different stereotype standards often occur while evaluating men and women in leadership roles. Catalyst (2005) states that leadership behavior is typically seen as “male behavior” and men are perceived as natural leaders. In contrast, women have to constantly prove that they can be good leaders as well.

Stereotypes can result in gender discrimination. Interviews conducted by McKinsey & Company (2007), for example, revealed that 27% of women compared to 7% of men felt discriminated against during their professional career.

The personality profile assumed as necessary for success in business is associated with toughness, assertiveness and competitiveness. However, according to Wippermann (2010), women are often perceived as mellow, socially minded, sympathetic and holistic. For this author, the issue is that women are tough and resourceful; they can possess assertive behavior and

Leadership behavior is

typically seen as “male behavior”

and men are perceived as

natural leaders.

27% of women compared to 7%

of men felt be-ing discriminated during their pro-fessional career.

10min 20 30 40 50 60

Cleaning and other upkeep

Food preparation

Shopping and services

Childcare

Dish washing

Other domestic work

Ironing

Laundry

Gardening

Handcraft and prod. textiles

Construction and repairs

Source: Eurostat, 2006

WomenMen

Exhibit 12: Distribution of domestic work among men and women6 (in minutes)

are often more sensitive than men when managing the company. Women are also reported to be better “care takers” and more team-oriented; they are better in supporting and encouraging their colleagues or subordinates and they have greater ability to reward colleagues (Bernardi et al., 2009). A study by Catalyst (2007) also concluded that women are perceived as not so effective at problem-solving and delegating as men. This perception is mainly held by men, therefore, it is much harder for women to succeed and enforce their plans and directions in occupations or positions with a male majority.

In spite of the fact that women possess many important skills which could diversify the managerial pool or board and increase company performance, such stereotypes are a key barrier to women’s advancement. Three effects caused by stereotyping have been found by Catalyst (2007). The first effect is “extreme perceptions”. To respond to this, women are argued to have two possibilities: first, to act according to gender stereotypes or, to go against them. While they behave in the way that is considered as “female behavior”, which is being cooperative and relationship-focused, they are evaluated as

“too mild” in leadership skills. While they behave against gender stereo-types, which often includes being assertive, ambitious, authoritative and task-focused, they are assessed as “too tough”. These stereotypes mean that women are never considered as being “just right”.

The second effect is that there are sometimes higher expectations made of women than of men. Women tend to be more controlled by their employers, with less support and less reward. Also, standards that women face tend to be much higher than for men. They have to prove time and time again that they have ability to lead even before they are in a leading position.

The third stereotypical effect is that women are perceived as competent or likeable, but hardly both. While they adopt leadership behavior and are assertive, authoritative and ambitious, they are perceived as competent as well as aggressive and self-promoting. Women’s colleagues and subor-dinates can evaluate this behavior as unsympathetic and as compensation for lack of power. On the other hand, while they behave as likeable they are perceived as not possessing the right leadership skills.

It is a tough task for a woman to choose which behavior(s) to adopt. One of the female speakers at the conference mentioned that she adopted a male model of behavior and that she didn’t have any problems as “the only” women in the company. Others stated that they had some problems at the beginning of their career. However, women and men are what they are and nobody should be forced to change behavior in order to be taken seriously.

Women have two possibilities, to act according

to gender stereotypes or to go against them.

Women are due to

stereotypes perceived as

competent or likeable, but

seldom both.

50 First Conference

We should change our stereotypical perceptions of women and men and their role in the business world, and their different skills and attributes should be taken as strengths not as weaknesses.

Advancement in a career

Wippermann (2010) in his study of barriers and bridges to women in ex-ecutive positions speaks about big jumps in career paths. He states that big jumps are typical for men’s advancement in their career. An ambitious male has clearly determined goals for his career and he is not willing to wait until somebody finds out that he wants to achieve a higher position. Wippermann (2010) states that this kind of man goes directly for what he wants. He does not care that he might not follow the typical way of career advancement.

Women, on the other hand, according to Wippermann (2010) are more careful. He states that they tend go step by step through all the layers in the company. They tend to be more shy to advance faster in their career. Furthermore, they are concerned that they have to perform better than men, that they will be exposed to higher expectations and that they will have to defend their personal management concepts as the minority in a majority group of men.

According to Bernardi et al. (2009) and Barber and Odean (2001) a key difference is that men are usually more self-confident, ambitious and have a stronger competitive drive. According to a survey conducted by Hewlett et al. (2005) only 35% of women see themselves as very ambitious versus 48% of men with the same self-image. A board member of a banking group interviewed by McKinsey & Company (2007, p.10) reported that “On the same project, the men will demonstrate 100% ambition even if they only have 50% of the required skills, whereas the women will be concerned about only having 80% of the required skills”.

Women are more risk averse and reluctant to invest in their education and training and any other effort which is costly (Gneezy et al., 2003). Women do not promote themselves at every opportunity as men do and they wait until somebody comes and asks if they are interested in better job posi-tion or until somebody sees good results of their job (Branson, 2007). Furthermore, highly qualified women do not aspire to the higher positions with power as much as men. On average only 15% of women expressed this desire in comparison with 27% of men (Hewlett et al., 2005).

Women cannot sit back and wait.

They have to promote

themselves.

Women advance step by step through all

the layers in the company.

On average, only 15% of women expressed

a desire to reach higher positions with power in comparison

with 27% of men.

However, despite being patient and performing well, Dalton (2011) states that full credit and recognition is not always forthcoming. The reason can be that women do not evaluate themselves highly compared to men. The McKinsey & Company (2007) report refers to Pasero (2003) who conclud-ed in a survey of MBA students that 70% of women consider themselves performing equivalently as their colleagues, while 70% of men rate their performance higher.

The report goes on to state that in cases where women are interested in higher positions and where they want to be on the board, they cannot “sit back and wait”. Appointments will not come their way without effort. They have to promote themselves, seek all the opportunities on how to leverage their connection and improve their qualifications. Burke (1997) and later Sheridan and Milgate (2005) conducted studies on how women advance in their career and their results are summarized in Exhibit 13. The most important factors that have been identified are: a strong track record, a good understanding of business principles, business contacts in gaining-board positions and high visibility. They have similar findings also about the way in which director’s names are brought to attention. Directors were mostly recommended by a standing board member of the company or its CEO. Their findings indicate that experience and skills are important, but being known by important people is crucial for advancing in a career and becoming a member of the board.

Exhibit 13: Research – appointing women to the board of directors7 The most frequent answers:

The most important characteristics to attain directorship Strong track record in one’s field or occupation 40,4%Business contacts 20,2%Good understanding of business 19,9%

How names were brought to the attention Recommendation by board member 74,4%Recommendation by CEO 58,5%Recommendation by someone who knows CEO or board 33,6%

Factors for nomination Desire areas of expertise and responsibility 57,0%Appropriate job title or leadership position 29,2%Being women 20,9%

Seventy per-cent of women

considered them-selves performing

equivalently as their colleagues,

while 70% of men rate their performance

higher.

Source: Burke, 1997

The most important factors

for women’s advancement in their career are:

a strong track record, a good understanding

of business principles, busi-

ness contacts.

7 Results were excluded from study about women serving on boards of directors in Canadian private and public sector organizations. Interviews with talented group of 278 women directors have been made to obtain these results. Recorded are just 3 the most frequent answers with proportion of women who answered so.

52 First Conference

Women’s hesitation to advance in their careers is one of the reasons of underrepresentation of women in higher organizational levels. The study by McKinsey& Company (2012) concluded that in their sample of 130 companies who had on average 37% share of women in the company, the representation of women decreased while moving to the upper levels of the company. This resulted with only 14% of women in senior management, 9% on seats on executive committee and only 2% as CEO. (Exhibit 14)

To encourage women in their professional development and make sure that they will not hold back, recruitment, appraisal and career manage-ment in the company have to be changed, so they will not be a barrier for women’s advancement. The tools for this improvement suggested by McKinsey & Company (2010) are effective training, coaching and monitor-ing programs, which are, together with other recommendations regarding recruitment, elaborated in the chapter on human resources. These tools will help women discover their potential and become more confident and successful in a male-dominated environment.

“Is it a man’s world?”

In spite of the slow change within the business world encouraged by the increase in the participation of women, some authors argue that the busi-ness world is still a man’s world mostly followed by “masculine norms” (Levant and Richmond, 2007). Catalyst (2009) elaborates some of the masculine norms, such as “avoid all things feminine”, “be a winner”, “show no chinks in the armour”, “be a man’s man” and “one of the boys”. These norms are supported and expressed by common expressions such as

“Take it like a man” or “Be a man about it”, which we can hear in everyday life. Perception of men’s identities is mostly identified by these expres-sions and men are criticized if they do not follow them (Pollack 1999).

Common expressions: “Take it like a man”, “Be a man about it”.

8 Companies with more than 10000 employees and/or revenues greater than 1 billion Euro and that provided data. Number of Companies = 130

Source:McKinsey & Company,

2012

Exhibit 14: Average percentage of women at various organizational levels8

CEO

Seats onexecutive comittee

Senior management and vice president

Middle management

Total company

5.0 x

1.7 x

1.8 x

2.1 x

2

9

14

22

37

Catalyst (2008) states that the male industry with the lowest proportion of women is the high-technology sector. A report from European Commission (2006) found that in spite of the increasing number of female students, the industry average is about 18% of women. They refer to the “leaky pipe line” through which approximately 2/3 of female students with a good track record and strong interest are lost. The following Exhibit 15 illustrates the representation of men and women at each stage of the social science and humanities ladder starting from undergraduate students, ending with the highest post at which research is conducted (Grade A).

The technology industry average is

about 18% of women.

As is evident from the graph, more women than men are attracted by social science subjects and the humanities, but there is a progressive decline in the participation as we go through the career stages. The following exhibit 16 illustrates the representation of men and women at each stage of sci-ence, engineering and technology disciplines.

7 Results were excluded from study about women serving on boards of directors in Canadian private and public sector organizations. Interviews with talented group of 278 women directors have been made to obtain these results. Recorded are just 3 the most frequent answers with proportion of women who answered so.

54 First Conference

Looking at the Exhibit 16, it is apparent that more men than women enter into science, engineering and technology education. Participation levels in the first stage of a career up to Grade C are constant and there is no evidence of a gender leaky pipeline, but participation of women on high positions is very low, only 9% in 2003. Moreover, many women included in this percentage work in non-specific fields, such as HR, finance and com-munication, so the final number of women who really work on technology tasks is even lower.

To improve the underrepresentation of women in jobs that are tradition-ally seen as “men’s jobs”, education requires a radical change. Access to higher education in fields such as engineering and management in par-ticular needs to be improved and so does attracting talents from these fields. However, to change perceptions we need to start from childhood (McKinsey & Company, 2007).

“Glass ceiling”: phenomenon that

keeps women from reaching the top levels

of an organization.

9 Percentage of male and female participation in social science and humanities across EU-25 countries in 2003 / 10 Percentage of male and female participation in science and engineering across EU-25 countries in 2003

M 2003M 1999W 2003W 1999

Source:European commission,

2006

Exhibit 15: Research career ladder9

(social science and humanities)

0

20

40

60

80

100

Grade A

85871513

Grade B

68703230

Grade C

58634237

ISCED 6 Graduates

57624338

ISCED 6 Students

54564644

ISCED 5A Graduates

41445956

ISCED 5A Students

46485452

Men

Women

M 2003M 1999W 2003W 1999

Source:European commission,

2006

Exhibit 16: Science, Engineering and Technology career ladder10

0

20

40

60

80

100

Grade A

919298

Grade B

77832317

Grade C

70743026

ISCED 6 Graduates

66703430

ISCED 6 Students

64683632

ISCED 5A Graduates

66683432

ISCED 5A Students

70703029

Men

Women

Catalyst (2008) states that one of the reasons for the significant under-representation of women in senior positions is that the majority of men in leadership drive women away. Corporate culture(s) created by men are not always attractive for women and some are concerned that they will not have enough support and opportunities for advancement. This type of industry is not a very flexible workplace and it is perceived that women cannot effectively combine work and personal life. The technology industry is typical for its lack of mentors and role models who could lead women and who could support them in making their accomplishments known to important people. The lack of women also makes it difficult to create good and effective networks, which could be used in women’s favor.

Another fact concluded by these researchers is that women with univer-sity degrees are more likely to face barriers in career advancement. The reason for this is that the more educated women are, the higher they want to advance but higher is also the probability of facing “a glass ceiling”11.

Catalyst (2009) states that whereas business is primarily dominated by men, men should be engaged more in gender initiatives to make a change. To be able to engage men in gender initiatives, awareness of gender bias among them has to be increased. Their study concluded that the more aware men are about gender bias, the more likely it is that they will real-ize the importance of gender diversity. The following Exhibit 17 illustrates results where 96% of men who were aware of this issue agreed that achiev-ing gender diversity is important, compared to 74% of men without aware-ness about gender bias.

Corporate culture created by men

is not always attractive

for women.

Whereas business is primarily

d ominated by men, men should be

engaged in promoting initiatives to make a

change happen.

56 First Conference

Catalyst (2009) also suggests that one of the ways to improve women’s situations concerning their presence in technology companies or other majority male companies is to train supervisors and to equip them with the necessary skills to be able to supervise people of both genders. These skills should include communication, giving feedback, ability to coach women, providing career guidance and identifying advancement opportu-nities. The training will help them to follow/learn effective managerial be-havior that they have experienced in their career. With better supervisors, companies will be more likely to attract more qualified women and be more competitive.

The solution is to train supervisors

to have necessary skills to supervise

women.

11 Powell and Butterfield (1994) definition of “Glass ceiling” is, that it is a phenomenon that keeps women from reaching to the levels of organization. / 12 Companies with more than 10000 employees and/or revenues greater than 1 billion Euro and that provided data.

DisagreeAgree

Neutral

Low awareness(in %)

74

323

2 2

96

Highawareness(in %)

Exhibit 17: Results of interviews with male respondents12Source: Catalyst, 2009

“Achieving gender equality for

women and men is an important

social issue to me”

The second conference, held on 17th April 2012, focused on the effects of gender diversity on the financial performance of the com-pany. The keynote speaker was Jean-Michel Monnot from group So-dexo Europe, who had a presentation about gender diversity in his company and the programs or instruments they have implemented to stimulate gender diversity. The panel session was led by Pierre Kihn, CEO of Office Freylinger S.A.. The main discussion between panelists focused on the sharing of experiences and opinions about government regulations related to the number of women on boards of directors.

Jean-Michel Monnot – Director of Diversity Group Sodexo Europe

Pierre Kihn – CEO, ing. Dipl. Chim. UCL, Office Freylinger S.A.

Amal Choury – Managing Director, e-Kenz S.A.Romain Bausch – President and CEO, SES S.A.Christiane Wickler – Managing Director, Pall CenterSilvia Sitzen – HR Director Luxembourg and Regional Services, Goodyear Dunlop Tires Operation S.A.Laurent Jossart – Executive Vice President Finance, Luxair S.A.Rita Goffin – Deputy General Manager, Systemat Luxembourg PSF S.A.

Keynote Speaker


Panelists

Second Conference17th April 2012

Definition

Financial performance is a measure of how well a firm can use assets from its primary mode of business and generate revenues. This term is also used as a general measure of a firm's overall financial health over a given period of time, and can be used to compare similar firms across the same industry or to compare industries or sectors in aggregation. (Investopedia.com 2012)

Financial Performance


Sodexo is known for its diversity program and was rewarded as the Cata-lyst Winner 2012 13.Women occupy 54% of total Sodexo workforce, 40% of managers, 20% of top 300 and 38% of the board members. Their cur-rent objective is to reach 25% of women in the top 300 positions in the company.

To increase diversity they provide training, mentoring, network develop-ment and working time flexibility. They identify lack of networks as key factors why women are still a minority in senior management. Mr. Monnot advised that networks must be fostered and developed because women do not always tend to use professional networks. Another issue is that women do not have relevant role models that can be visionary for women in the company. It is also important to raise awareness and communicate gender equality issues among the company. For that purpose they have an internal press process for communicating issues associated with gender diversity. Mr. Monnot said that it is also important to have initiatives at all levels of the company to create a ‘wave’ of awareness. He said that a company cannot be changed without changing the culture.

Mr. Monnot shared an example where diversity helped them in being award-ed an important contract. For the London Olympic Games, the committee president was really concerned to choose suppliers that are committed to diversity. Having gender diversity instruments helped Sodexo to be chosen as one of the main suppliers.

He stated that talent is equally spread out between diverse people. He believes that balanced teams have better results and can increase per-formance levels. The problem of gender diversity has been discussed for many years, but progress is still slow. Therefore, his proposal is that activi-ties should move ahead much faster.

Mr. Jean-Michel Monnot Group Sodexo Europe


60 Second Conference

As panel moderator, Pierre Kihn focused mainly on the discussion about the experiences of panelists regarding gender diversity and financial as well as group performance. He also touched on the quotas issue and shared with all the speakers the opinion that quotas are not the best way to reach a higher proportion of women on tboards of directors.

Mrs. Goffin shared her experience about being a woman in a sector that is traditionally male-dominated. She stated that she had never faced any difficulties in her career, maybe because she adopted the male model of behavior to fit in. Conversely, she said that male employers are more flex-ible. In her view, women work differently (and work harder) and tend to be more sensitive. In spite of that fact, women do not display a full interest in the industrial world. It is choice of career that must be changed with more women evaluating a wider range of career choices.

Mrs. Wickler works in distribution solutions, which means that she is used to male workers and working in a male environment. In the beginning of her career, she used to hear jokes about being a woman being employed in the company, however, this eventually changed.

She commented that women are not a commodity with which to add value but instead she argues women bring “complementary value”. They are self confident in purchase decisions; they are focused on goals and they are interested in details. To make a change, it is important to educate not only women, but also men in the work place. It is particularly crucial is to begin with the next generations to change perceptions and stereotypes.

Mr. Pierre Kihn Office Freylinger

Mrs. Rita Goffin Systemat

Mrs. Christiane Wickler Pall Center

13 The Catalyst Award annually honors innovative organizational approaches with proven, measurable results that address the recruitment, development, and advancement of all women, including diverse women. (For more information go to http://www.catalyst.org/page/54/catalyst-award)

Mr. Bausch said that diversity has many facets and that all of them are important. A gender balance is necessary but so is cultural diversity. SES has, for instance, 200 employees with 43 nationalities. What is also im-portant for SES is a good balance in terms of age. To achieve good results, appropriate HR policies need to be implemented. SES focuses on a fair recruitment process, remuneration and flexibility in working time, so it is easier to balance personal life and work. To increase women’s interest and the number of women in engineering positions, they provide engineering training for female students. Their objective is to recruit the best talents, whoever they are.

With regard to gender diversity, Mr Bausch comments that the poor re-sults are partly related to the fact that they are a high technology industry. Women represent 25% of the staff and occupy 6% of engineering positions. Currently there is no female member in the board of SES. However, Mr. Bausch stated that the situation cannot be analyzed just from a statistical point of view. Women at SES are in a minority but they occupy important technical positions. If we consider the percentage of women with a tech-nical background in the market and in SES, then SES has a very good proportion of women.

Additionally, he stated that women do not want to get to higher positions just because of the quotas; they want to be there because they deserve it and because they are talented. Only voluntary ways for developing gender diversity can really work. Quotas, in his view, are irrelevant.

Mrs. Sitzen reported that women have other perspectives and different points of view. Furthermore, they have to project themselves more to dem-onstrate that they have something to give.

In view of the nature of the industry it belongs to, Goodyear tends to be a male dominated environment but they are open and willing to attract more women. They try to “sell” the company but this type of environment is not always very interesting or appealing for women. In such environments women feel that they must prove themselves all the time. For this reason, it tends to be more difficult for them. She said that the key to success is education.

Her view on the quotas issue is that: “quotas are not what women want”. She would not like to be on the board only because companies are obliged to have a given proportion of women. Women want to be there for merit, not because of a quota system.

Mr. Romain Bausch SES

Mrs. Silvia Sitzen Goodyear


Mr. Jossart stated that it is difficult to say what the contributions of women for the company are. Every woman is different. As with male colleagues, some of them are good, some are average. Performance is very difficult to distinguish and to draw conclusions from.

For Luxair, what is important is cultural diversity. Luxair must build com-plementary values and it is not a question of women and men. Women are becoming more masculine, following male models and sacrificing personal life. Women are often concerned and sensitive to the “jokes” constantly made about them. Men are less pragmatic, less prepared and less organ-ized. They have to be more efficient with women around.

When asked about quotas, he believes we should train and boost people instead of introducing quotas for women.

Mrs. Choury said that women tend to hold back. Many of them have high potential, but they do not move forward. Therefore, companies should help them to move. Young women should be encouraged to be more ambi-tious. Maybe, companies should look for talent and competences instead of gender. She stated networking as an important instrument to improve women’s position.

She exposed her opinion against quotas, mentioning that it is important to have talented and performing people, not to force companies to include women through quotas. Quotas, in her view, would be “a disaster”.

Mr. Laurent Jossart Luxair

Mrs. Amal Choury e-Kenz

Gender diversity and group performanceWomen’s roles and contributions to organizational workplacesWhat number of women is needed to change the board’s performance?NetworkingQuotas

The table above summarizes the main topics discussed at the second conference. Some of the topics overlap with discussions in the previous section and some of the important issues, such as contribution of women to the board, were not widely discussed. For this reason, the following dis-cussion will focus on gender diversity and financial performance which are stated as the most significant in relevant reports and studies.

Diversity and group performance

Dalton and Dalton (2005) state that the more effective the board of direc-tors and board room processes are, the higher is the likely success of the company. What is crucial is how effectively the board is comprised, how the skill sets and abilities are combined and whether its members have access to critical information and resources.

A number of researchers (for instance: Klein and Harrison, 2007; Watson et al., 1993; Department for Business, Innovation and Skills, 2011; Ber-nardi et al., 2009), state that diverse groups have better knowledge bases, different backgrounds, diversity in opinions, new ideas, fresh perspectives, different life styles, creativity and innovation. For these reasons, therefore, they are better in solving conflicts, decision-making and generally in in-creasing company performance. Klein and Harrison (2007) conclude that companies with members diverse in knowledge, heuristics and perspec-tives have more instruments and insights because they can combine this wide range of skills in finding better solutions. The competitive advantage of having diverse boards also allows companies to achieve diversity in their products, services and labour market (Bilimoria and Piderit, 1994).

1.2.

3.

4.5.

The more effec-tive the board

of directors and board room pro-

cesses are, the higher is the likely

success of the company.



In contrast, a lot of researchers argue that in spite of the fact that diverse groups perform better, they can also face many conflicts. Watson et al.’s (1993) findings proved that groups diverse in gender can experience more process problems than homogenous groups. Neale et al. (1999) state that different types of diversity cause various kinds of conflicts and the way in which a diverse group solves these conflicts demonstrates how effec-tive diversity of this group is. Heterogeneous teams can also be slower in actions, because a more diverse group is sometimes diverse in opinions. For this reason, it can take longer to achieve a conclusion. Despite the fact that diversity also has negative effects, Neale (1999) states that the disadvantages of heterogeneity are exceeded by the advantages.

Women’s roles and contributions to organizational workplaces

Women are valuable members of organizations, not only providing impor-tant resources, values and different styles of working but also for providing strategic input to board direction. Crush (2004), for example, states that in spite of the fact that women count just for 51% of the population, they influence 95% of all purchasing decisions and they personally make more than 70% of all purchases in Europe (with more than 85% in the United States). These purchases are not just for typical female products. Women also make 60% of purchasing decisions on cars, 51% of electronics pur-chases, 80% of health care products and 92% of holidays.

According to Dezso and Gaddis Ross (2007) and Konrad and Kramer (2007) women have a different set of experiences than men. They are more likely to ask questions than men and have the ability to be good listeners. They tend to manage in a more interactive style, using team work to motivating their subordinates and colleagues. In comparison, because men have a longer experience of participating in board meetings, there is a tendency to make presumptions about the matters being raised and discussed.

Groups diverse in gender can

experience more process problems than homogenous

Gross.

Women purchase 60% of cars, 51%

of electronics, 80% of health

products and 92% of holidays.

The results show that 58% of the

companies with implemented

gender diversity programs had

better employee motivation, 57% customer satis-faction and 69%

brand image.

New research conducted by Hay group 14 (Weiss, 2012, p.1) indicated that leadership skills such as empathy, conflict management, self-awareness and influence were more prevalent in cases of women in senior general management. “Empathy has been found as the strength of 33% of wom-en, against just 15% of men, conflict management has been considered as strength in 51% of women, against 29% of men. Also, influence has been cited as strength of 32% of women, against 21% of men and self- awareness has been evident in 19% of women, against just 4% of men”. (Exhibit 18)

McKinsey &Company (2007, p.14) also concluded that some of the lead-ership behaviors were observed more in the case of women rather than men. They selected 9 behaviors which they claimed affected corporate performance: “Participative decision making”, “Role model”, “Inspiration”,

“Expectations and rewards”, “ People development”, “Intellectual stimu-lation”, “Efficient communication”, “Individualistic decision making” and

“Control and corrective action”. They refer to Eagly (2001), who discovered that women apply 5 of these 9 behaviors more often than men, and men apply two of them more often than women (Exhibit 19).

14 A subsequent study of data from the Emotional Competency Inventory and Social Hay Group, a behavioral database that contains information on emotional intelligence of more than 17 000 people worldwide


These behavior types adopted more frequently by women strengthen the “work environment and values”, “accountability” and “leadership team di-mensions”. Behavior adopted by men strengthen “coordination and control” and “external orientation”. These dimensions analyzed by McKinsey & Com-pany (2007) have a positive impact on corporate and financial performance.

The results of their interview questionnaire in the 2010 study (McKinsey &Company, 2010) reveals that 90% of women and 60% of men at the higher levels of the company are convinced that a higher representation of women in corporate leadership teams increases financial performance of the company. (Exhibit 20)

The study reveals that 90% of women and 60%

of men at high levels of the company are

convinced that a higher representation of wom-en in corporate leader-

ship teams increases financial performance.

10% 20 30 40 50 60

Self-awareness

Influence

Conflict management

Empathy

Source: Weiss, 2012

WomenMen

Exhibit 18: Leadership skills of women and men

Individualistic decision making 4%Control and corrective action 9%

People developement 7%Expectations and rewards 4%

Role model 4%

Inspiration 1%Participative decision making 1%

Intellectual stimulationEfficient communication

(Not statistically significant)

Women and menapply equally

Women applyslightly more

Womenapply more

Menapply more

Exhibit 19: Nine leadership behaviors that improve organizational performance


2007

It is also reported that the employment of (more) women in the company can help in times of economic crisis. A study by the European commission (2010b) presents examples from the banking sector. During the economic crisis, BNP-Paribas with almost 39% female managers, suffered a decline in its market value by 20% and in comparison, Credit Agricole with just 16% of women managers suffered a fall of 50%. This fact led the European com-mission (2010b) to conclude that having more women in the board room or in the top managerial positions may affect positively company’s profitability.

In addition, Roth et al. (2010) found that women generally scored slightly higher in job performance than men. However men had higher ratings of promotion than women even though they performed less well. A conclu-sion here is that women should be valued more for their different skills,

During the eco-nomical crisis,

BNP-Paribas with 39% of female

managers suffered 20% fall in market

value compared to Credit Agricole

with 16% female managers who suf-

fered fall of 50%.


instincts and perspectives which can increase the board’s performance outcomes. Roth et al. (2010) conclude that more women should be ap-pointed as representatives in senior management to increase the quality and performance of the company and they should be evaluated the same way as men.

Finally, on the issue of women’s contribution to the performance of the organization, McKinsey & Company (2010) argue that one of the most important practices for increasing the number of women on boards is the commitment of the CEO and top management. They must be convinced about women’s benefits and the competitive advantage of diversity in order to make a change. A survey conducted by McKinsey & Company revealed that “close attention of the CEO and the executive team to indicators of progress and visible commitment in managing gender diversity progress, are the most important drivers to increase the number of women at the top of corporations” (McKinsey & Company, 2010, p. 16).

Three women are a critical mass to change corporate performance

Many researchers state that in order to change the performance of the board, more than one woman needs to be appointed. Previous studies, for example Konrad and Kramer (2007), argued that one woman is not strong enough to change the dynamics of the board. The lone woman on the board might have to work hard to succeed and assert her opinions and ideas. Also, there is an issue of perception, where two women can be seen as separate dyad or female group not distinguishable from one another. In contrast, three women on the board tend to be less recognized as “women” or “female directors” but are recognized simply as “directors”. This leads Konrad and Kramer (2007) to argue that three or more women are the critical number that is necessary for causing a positive change in the dynamics of the board and thus increasing its performance.

These results are further confirmed in a study conducted by Price (2008) regarding responses to competition in gender mixed groups. He conclud-ed that the response of women was different according to the proportion of men and women in the group. The positive response of women as well as men increased with an increase in the proportion of women in the group. Price (2008) states that the presence of women motivates men to perform better.

Three and more women on the

board are a critical amount which

can already cause a positive chase

in dynamics and increase

performance.

Positive response of women as well as men increased

with increase in proportion of women in

the group.


2010

Exhibit 20: Interviews of C-level and Middle management respondents about impact of gender diversity on �nancial performance.C-level (CEO, COO, CFO,etc.)

Women(n=233)

Men(n=212)

n=445

62 15 23

90 6 4

+27%

n=464

% 10 20 30 40 50 60 70 80 90 100

Women(n=276)

Men(n=188)

ConvincedDon’t know

Not convinced

50 22 28

85 9 6

Middle management

+26%

McKinsey & Company (2007) in their study about effects of gender diver-sity in senior management on performance of the company states that the more women are in the senior management positions, the higher the performance of the company. Companies with 3 or more women in senior management positions scored better in all organizational performance criteria (Exhibit 21) than companies without women and in financial per-formance (Exhibit 22) than the average of companies in their sector. Companies with a fewer number of women than three did not differ signifi-cantly from the companies without female representation. These results establish that the critical number is 3 women out of 10 board members. This conclusion, therefore, is in line with the conclusion by Konrad and Kramer (2007) above.

Companies with 3 or more women in senior manage-

ment positions scored better in

all organizational performance crite-rions and in finan-

cial performance of the company.

15 Results show the percentage of employees with positive evaluation


McKinsey & Company (2010) also revealed that companies with the high-est share of women in executive committees show better financial perfor-mance. These companies exceeded companies with no women by 46% in terms of average return on equity and by 55% in terms of average EBIT margin. (Exhibit 23)

10 20 30 40 50 60 70

Innovation

Accountability

Capability

Motivation

External orientation

Leadership

Coordination and control

Direction

Work environment and values

Source: Eurostat, 2006

Comanies with 0 women

Companies with 3 or more women

Exhibit 21: Companies with 3 or more women scored higher in each organizational criterion than companies without women15

%

Industry averageCompanies with

most diverse management teams

10

20

30

40

50

60

70

80

Stock price growth 2003-2005

Average EBIT 2003-2005

Average ROE 2003-2005

Source: McKinsey &Company, 2007

Exhibit 22: Graph shows how much higher �nancial indicators are in companies with the most diversi�ed management teams

%+11,4% +10,3% +11,4% +5,8% +64% +47%

+10% +48% +36%

Analysis by industry

Industry Nomber of companies

ROE EBIT

Consumer goods and retail 38 X X

Industrials 65 X X

Energy, basic materials and eniroment 75 X X

Banking 35 X –

Telecom, Media and Entertainment, Technology

38 N N

Transportation, logistics and tourism 15 X X

X Verified – Non available N Not verified

The correlation of the number of women on the board of directors and financial performance has been addressed by many researchers (McKin-sey & Company, 2007; Deszo and Gaddis Ross, 2007; Adler, 2009 and McKinsey & Company, 2010). All of these conclude that there is a relation-ship between these two variables. It is important to note that none of the studies confirm a direct causation relationship, however.

16 Top quartile: 25% of the companies of the sector with the highest share of women in the Executive Committee, ROE: Average calculated on 2007 to 2009 period for 279 companies, EBIT: sample of 231 companies (Bank, Insurance and Financial services have been excluded), Scope: 6 European Countries: UK, France, Germany, Spain, Sweden, Norway and BRIC countries (Brazil, Russia, India and China)


Adler (2009) claims the link between women on boards and economic per-formance can have several interpretations. The first one is that companies who have been implementing gender programs for a longer time usually have higher profitability. The second interpretation is that companies with higher profitability tend to promote more women because they are not afraid of experimenting and they can afford to do this. The third reason is that there is an additional variable, which is linked with gender diversity as well as with performance. This variable relates for instance to board attributes or board size and has also been studied by many researchers. Haron et al. (2008), for example, have found linkages between attributes of members of the board and financial performance. In contrast, Dalton and Dalton (2005) have concluded that larger boards have a bigger pos-sibility to enhance diversity and they refer to their previous study from 1999 which concluded that larger boards are linked with higher financial performance. This proves that board size can also be one of the factors which can influence both gender diversity and financial performance. The last interpretation from Adler’s (2009) conclusion is that companies have higher profits when they have members who make clever decisions. One of the smart decisions, according to him, is to increase gender diversity in executive positions. The interpretation of this conclusion is that compa-nies with the best brains are the ones which have the highest profits and gender diversity is just a side effect of their clever decision.

Gender diversity and financial performance – the case of Luxembourg listed companies

To analyze the link between gender diversity on the boards of directors and financial performance in Luxembourg’s conditions, in-depth research of 20 Luxembourg companies listed on the Luxembourg stock exchange (Bourse de Luxembourg) for the period 2005-2010 has been conducted by a researcher of the University of Luxembourg (Exhibit 24).


2007Labour Force Average return on equity 2007-2009

0 10 20 30

Companies with 0 women in

executive commitee in that specific sector

Companies in the top quartile for the women

representation in executive committee vs. sector

0 10 20 30

Average EBIT margin2007-2009

Exhibit 23: Companies with higher proportion of women in their executive committees show better �nancial performance16

+46% +55%

Exhibit 24: Sample companies

Company Activity Age17

2010Size18

2010

Arcelormittal Steel industry 9 102669,8039

BIP Investment Partners Holding – Investment company

10 428167,786

Brait Group of investment and financial services

34 234431,3725

Dexia Financial 19 566735000

Espirito Santo Financial Group Holding (bank-insurance) 26 87150300

Foyer Insurance 12 4198697,1

Gefinor Holding investments 42 276643

IdB Holdings private banking service 16 82000

KBC Group Financial 12 320823000

Quilvest Holding-finance 60 1072705,882

RTL Group Media group 38 5597000

SES Satelites 9 8228500

Sociéte Electrique de l’Our-SEO Energy 59 157258,401

Sociéte Financière des Caoutchoucs Plantations 51 1459235,168

Vedanta resources Basic material industry 31 24060000

Ventos Holding diversified 16 222667

Socfinaf Plantations 49 584700,362

Compagnie de l’Occident pour la Finance et l’Industrie (COFI)

Banking and financial group 39 1632329412

Luxempart Holding – Investment company

22 825356,891

Socfinasia Plantations 38 887742,239

These 20 companies comprise, on average, 234 board positions with only 4 women in 2005 participating in these boards and 10 women in 2010. On average, only 6 companies from this sample have women on the board. The average increase in women’s participations on the boards for the pe-riod is 0,45% per year (Exhibit 25).

Source: Kmochova, 2012

The average increase in women’s participation on the

boards for the period is 0,45% per year.

17 Age is calculated from the date of constitution to 2010 18 Size is measured as Total Assets in Million Euro


Considering the relationship between the number and proportion of women on boards of directors and financial performance, the only statistically sig-nificant negative correlation has been found for pulled cross-section data (grouped data for the whole period 2005-2010) between number of women on the board and ROA ( Return on Assets). Undertaking an analysis of each year in the period and a lag analysis, it is not possible to conclude any statistical significance for the link between gender diversity on the board and corporate financial performance for this sample of Luxembourg firms.

However, while comparing companies with and without women, the results show that companies without women on average outperformed companies with women (Exhibit 26).

It is not possible to conclude statisti-

cal significance for the link between gender diversity

on the board and corporate finan-

cial performance for our sample of

Luxembourg firms.

Source: Kmochova, 2012

Exhibit 25: Increase in the number of women on the board of directors

1

3

5

7

9

11

201020092008200720062005

Companies with women are on average bigger and younger than compa-nies without women. The reason can be that younger companies are not as traditional and not influenced by stereotypes. For that reason they do not have so many barriers in hiring and attracting more women. The rea-son for lower financial performance could be that the revenues of younger companies are not as stable and they could be more negatively affected by economic crises (which occurred during half of the observed period) than more stable older companies. Another affect can be the experience


of women. Although this affect was not detected in this study, Deutsche Bundesbank (2012, p.39) released a discussion paper, which stated that

“risk taking increases although the change is economically marginal” and reflects that this might be caused by their lower experience compared to their male counterparts. However none of the results in our study on differ-ence between companies with women and men are statistically significant.

However, as has been said earlier, key researchers on this topic argue that at least 3 women are needed, on an average sized board with 10 mem-bers, to make a change to financial performance. In this research, it was not possible to divide companies into companies with 3 or more women and companies without women because only 1 company has more than 3 women on the board (and only for the years 2009 and 2010). These facts could explain better the lack of significant results in this analysis of the relationship between women on the board and financial performance.

To analyze if there is a difference between industries, we also divided our sample companies in 2 sectors – industrial and financial. The findings concluded by Deutsche Bundesbank (2012) were supported by the results of this research. In the industrial sector no significant relationship can be found between financial performance and gender attributes, however, in the financial sector it is possible to identify a significant negative link be-tween all the gender attributes and ROE as well as ROA.

In conclusion, these results do not prove any general link between gender diversity on the board of directors and financial performance. However, they show a negative link between the considered variables in the financial sector. These results cannot be applied to the whole “population” due to the small size of the sample and small representation of women. However it does reveal that the proportion of women in Luxembourg’s listed compa-nies is small and the increase in their participation is rather slow.

19 EBIT = Earnings before Interest and Taxes / ROE = Return on Equity / ROA = Return on Assets

Companies with 1 women and moreCompanies with 0 women

Source:Kmochova, 2012

Exhibit 26: Mean di�erence of indicators for companies with and without women19

EBIT

-46,6% -12,8% -37,3% -49,8% +355,4%

ROE ROA Age Size

Networking

As noted above by the panel speakers, having wide networks is deemed as necessary for being an effective and successful member of the board of directors. Informal professional networks are especially important com-ponents of successful power acquisition (Sheridan and Milgate, 2005). Contacts with members from other companies provide important informa-tion, resources and support. The question is: how are these networks developed in the case of women?

Considering the ability of women to build relationships, women should excel in this area. However, research reveals that women still tend to hold back in terms of networking. Dalton’s (2011) survey indicated that women claim they do not have time for networking or any other extra effort. In spite of that fact, a study conducted by Catalyst (2009) identifies that women’s networks are well developed but these networks are mostly with other women. The issue is that existing networks at the level of boards are usually male networks and to be integrated into them is not always easy for women if they are newcomers to the board.

Dalton (2011) states that the fact that women are not integrated so well in existing networks leads to the perception that they are less influential and important for board positions. To give themselves the possibility of broader professional exposure, they need to be aware of the importance of networking and participate more, for instance, in meetings, professional networking events and online networking. He argues that women should be more effective at networking with colleagues outside of the company to gain important information and contacts and so increase the level of their influence. He also advises that organizations have a key role to play as well in supporting women in the development of mentoring or external networks.

Informal professional networks are espe-

cially important com-ponent of successful

power acquisition.


The third conference, held on May 15th, focused on diversity as a challenge for the Human Resource processes. The keynote speaker was Dale Meikle, Global Diversity Office Leader at PwC and the panel was moderated by Evie Roos from Arcelor Mittal. Among the main topics discussed were the practices to increase female participation and the obstacles and barriers to implement diversity initiatives.

Dale Meikle – Global Diversity & Inclusion Program Office Leader, PwCEvie Roos – Vice-President Compensation & Benefits, ArcelorMittal

Christian Scharff – Partner Human Resources Services, PwCDiane Ries – Managing Director, HR Services S.A.Jean Luc Verheggen – HR Country Manager, DuPont de Nemours S.àr.l.Fabrice Poncé – General Director, Adecco S.A.Eliane Fuchs – Owner- manager, Vitalvie Espace Bien-Être

Keynote Speaker


Panelists

Third Conference15th May 2012

Human Resources

Definition

Human Resource Management (HRM) is the organizational function that deals with issues related to people such as com-pensation, recruitment, performance management, organization development, safety, wellness, benefits, employee motivation, communication, administration, and training.

HRM is also a strategic and comprehensive approach to manag-ing people and the workplace culture and environment. Effective HRM enables employees to contribute effectively and productively to the overall company direction and the accomplishment of the organization's goals and objectives (Heathfield, 2012)


In her presentation, entitled “Moving the needle: Effective global diver-sity strategies at PwC”, Mrs. Meikle presented how the company builds its strategy to implement and monitor diversity issues around the globe.

Among many aspects, she mentioned how the global diversity office first designed processes to identify, collect and evaluate data regarding this issue in order to construct a tool that could be widely used in the network. In particular, she discussed how specific territories should take account of their own characteristics and socio-economic factors when creating a diversity management plan. The speaker stressed the importance of programs and trainings, especially those which address the unconscious bias regarding women. The latter issue is a very recent and sensitive matter, however, but once the company realized how bias and implicit associations have an influence on daily activities and constitute barri-ers to the promotion of women, special training was developed for the leadership in order to overcome these obstacles. She recognized the process as long-term and advocated that the speed of change increases along the process.

Mrs. Roos raised important questions to the panelists to stimulate a dis-cussion about how companies are addressing the diversity issue and how this theme has evolved along the years in terms of balancing recruitments. She also initiated arguments that tried to find explanations for inequality in income and others to analyze what the barriers are to the access of women to higher management positions.

Mrs. Dale Meikle PwC

Mrs. Evie Roos Arcelor Mittal


82 Third Conference

In her talk, Mrs. Ries discussed the evolution that has been occurring around diversity and gender issues. According to her experience, this was not a topic that has previously received a lot of interest as there were not an impressive number of women in management positions. The situation has changed in current times, however. Now companies have policies and actions in place, and more women are there to serve as role models.

The panelist also considered it important to mention that the implementa-tion of diversity policies depends on the size of the organization. Small and medium size (SMEs) companies have reduced staff and, therefore, need to be mainly concerned about finding the right skills independently of gender. It is more difficult for SMEs to create formal plans to handle diversity than it is for large firms.

According to her experience, she states that companies are still working with a twentieth century model where it was assumed that a fixed work schedule was more efficient than flexible working patterns. Nowadays, so-ciety and the work place need more flexibility.

During his speech, Mr. Verheggen raised a problem which is frequently mentioned in relation to gender diversity: the lower interest of women in technical positions. He declared the impossibility of achieving a balanced staff if only 20% of the applicants for technical positions are female. Al-though Mr. Verheggen recognizes that considerable work must be done in order to attract women to fields typically male-oriented, he argues that women must be motivated to join this type of industry. He mentioned, too, that DuPont demonstrates a more gender balanced structure in other departments.

Mrs. Diane Ries HR Services

Mr. Jean Luc Verheggen DuPont de Nemours

On the daily recruitment activities of Adecco, Mr. Poncé alerted that the search for professionals should not be guided by gender preferences - but rather by skills. The balance depends on the field of activity of his clients. For example, in some areas it is harder to find women applicants, e.g. for engineering positions, and in others the challenge is to provide male staff, such as in the health sector. However he observed that a change is already occurring.

Another difficulty seen by Mr. Poncé is the lack of prominent reference points (in leadership and management) for women in the workplace. Wom-en have begun to communicate themselves quite recently as they have started to achieve and succeed in significant management positions. This means that so far there was an absence of role models that women could follow and with whom to mirror themselves.

In his speech, Mr. Scharff shared local examples of the challenges and practices that can be implemented to foster the presence of women in management positions. He reflected on the possible causes that are still present in income inequality, pointing to how the less traditional career paths that women tend to have (due to maternity leave) can impact career development. He also outlined the challenge of dealing with discriminatory bias practiced by women towards other female subordinates or colleagues, promoting them less or being more demanding in terms of performance than they are with male employees. Lastly, the panelist stated how the company and staff must believe in gender balance and change organi-zational behavior by using a holistic approach to ensure the success of diversity programs.

Mrs. Fuchs mainly addressed the importance of women as role models and in particular how female networks may contribute significantly to the development of a woman’s career. She commented that the possibility of sharing experiences stimulates discussion and facilitates confidence, enabling women to be supported by others in senior positions.

Mr. Fabrice Poncé Adecco

Mr. Christian ScharffPwC

Mrs. Eliane Fuchs Vitalvie Espace Bien-Être

84 Third Conference

Tools and practices to facilitate female access to management positionsCareer ManagementObstacles to diversityCompany’s commitmentChange in mentalities

The themes presented above were summarized from the panel’s discussion. The subsequent section will examine how the approach to diversity manage-ment within organizations has generally progressed and what the current research has discussed about the main issues raised by the panelists.

Human Resource Management and Diversity Management Practices

Human Resources Management (HRM) is the function within organizations which deals with processes of managing people. Despite the fact there are different views about the scope and nature of Human resources, it is widely recognized as being responsible for selection, training, performance, de-velopment and benefits (Shen et. al., 2009).

Whilst the HRM function is the custodian of people management process-es, diversity management is a particular term used for the management of diverse workforces. These functions have considerable overlap and di-versity management practices conducted through efficient HR practices and procedures is argued to lead to positive outcomes (Shen et al., 2009, p.246). Ollapally and Bhatnagar (2009) credit to HR personnel the re-sponsibility to present a case for diversity, to analyze the impact and the advantages of maximizing the potential of a diverse workforce.

A diverse workforce, however, is argued to be more than a simple increase in the numbers of racial, cultural, gender or class representation. Instead, a diverse workforce recognizes a combination of multiple beliefs, perspec-tives, understandings that members of varied groups brings to an organi-zation (Thomas and Ely, 1996; Woodhams and Lupton, 2009; Shen et al., 2009).

The discussion about diversity management has recently evolved into arguments about the necessity for a more strategic and comprehensive approach which “focuses on the unique strengths of people in addition to giving each individual an equal opportunity” (Ollapally and Bhatnagar,

1.

2.3.4.5.

Gender diversity is also a combination of multi-

ple beliefs, perspectives, understandings that

members of varied groups bring to an organization.

The attitudes related to diversity issues

in corporations are not characterized by

uniformity and clarity but by a variety of

understandings and applications.


2009, p.454). The attitudes related to diversity issues in corporations are not characterized by uniformity and clarity but by a variety of understand-ings and applications (Shen et al., 2009). So far, some authors (Thomas and Ely, 1996; Shen et al., 2009) argue that the dominant view of a di-versity perspective has been based on the principles of Equal Opportuni-ties (emphasizing equality and fair treatment). Although promoting equal opportunities may encourage an increase in demographic diversity, this approach does not foster a valorisation of personal differences but treats every person as an equal part of a collective or “greater body” (Woodhams and Lupton, 2009). The indicators to measure performance in equal op-portunities are based on the effectiveness of the company in recruitment and retention figures.

A more holistic perspective, which originated at the end of the 1980’s with the advancement of a more globalized and interconnected world, con-ceived diversity as an important strategic advantage. Companies began to see diversity as a competitive advantage in matching the demographics of the workforce to consumer groups. The ethically correct “equal opportuni-ties” discourse gave way to a “dominant paradigm for voluntaristic organi-zational policy making” (Thomas and Ely, 1996, p.160). Although it can be argued that a clear distinction cannot always be made between equal op-portunities and diversity management (Kirton and Greene, 2009, p. 160).

Thomas and Ely (1996) point out that a new understanding of diversity has emerged, even though it is practiced by only a small number of organiza-tions: one that “incorporates employees’ perspectives into the main work of the organization” (p.85), internalizing the differences and creating a culture that enables learning and growth. Consequently, it is understand-able that its effectiveness is significantly dependent on the way a company understands diversity, the practices that it implements and how it is incor-porated in the organizational culture.

It may explain, therefore, why several companies adopt programs but do not collect results, as identified in recent research conducted by McKinsey & Company (2012), which detected that 90% of the organizations have initiatives in place, but only a few have positive outcomes.

In the following section, the analysis will focus on the aspects and pro-cesses, through which organizations can monitor, implement and evaluate diversity issues, precisely those regarding gender diversity.

The effectiveness is significantly

dependent on the way a company

understands diversity, the practices that it implements and how it is

incorporated in the organizational

culture.

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Diversity practices

Career Management programs

Recruitment and career management processes are central to any discus-sion on diversity programs (McKinsey & Company, 2007). Recruitment poli-cies must not only be fair in terms of giving equal opportunities irrespective of the gender, but should also promote a gender neutral environment that attracts women to the workplace. In the next stage, fair and clear promo-tion rules are seen as key factors in providing qualified candidates. Sacier-Sultan (2012) observes that, in general, promotion for men is based on potential, whereas for women, it tends to be based on what they have already achieved. Moreover, recruitment policies should be adapted to different industry sectors as they display different structures and different levels of women’s participation.

Specifically to facilitate female careers, most diversity programs include at least one of the following aspects: Mentoring, Coaching, Training, Network-ing and role models.

As noted above, these points received particular attention from the pan-elists. These initiatives are understood to help women comprehend the internal code of an organization, to develop their potential and ensure that they have all the necessary tools to move further.

A mentor is usually a senior, experienced employee who serves as a role model and provides support, direction and feedback to a younger, less seasoned employee regarding career plans and interpersonal develop-ment. The advantage of this practice is that it increases the visibility of the protégé to decision makers in the organization who may influence career opportunities”. They may play different roles such as career development ones, i.e. coaching, and psychological roles, such as counselling (Curtis and Dreachslin, 2008, p. 124). Despite the fact that mentoring has been widely argued to be an effective tool, the same authors argue for the need for more empirical research on mentoring intervention, in order to estab-lish guidance to human resource professionals on the creation of formal mentoring and coaching programs.

The recruiting poli-cies must be not

only be fair in terms of giving equal

opportunities irre-spective of t gender,

but also promote a gender neutral

environment that enables women to

be attracted.

The policies should be adapted to the different sectors as they present

different structures and different

levels of women’s participation.

Training and organizational development activities, such as team build-ing, awareness workshops, survey feedback, process consultation, and intergroup dynamics are also argued to improve the success of diversity programs (Curtis and Dreachslin, 2008). However, some aspects are con-sidered critical for successful training in diversity: setting specific measur-able goals, adapting the training to organizational needs and measuring the impact of training on behavior – this last one being rarely tracked (op. cit.).

The importance of providing role models for younger generations is sup-ported by other authors (Galbraith, 2010; Goodman et al., 2003) who ar-gue that women tend to move to firms which have a corporate reputation as ‘woman friendly’. This exchange of experience may be developed through efficient networks, which is considered to support career development. For example, Curtis and Dreachslin (2008), based on work from Emmerik (2004), suggest two ways of measuring network diversity: range of differ-ent social systems and the number of people in the network. The authors also recommend that human resource managers should provide training in personal skills development for the employees, in order to help them create better working relationships and establish networks.

Research findings suggest that the adoption of diversity policies is promot-ed when there is an increase in women’s managerial participation (Dobbin et. al., 2011). This point is also sustained by other researchers (Goodman et. al., 2003) whose conclusions claim that the initiatives to increase women’s participation in senior positions are more likely to be successful if there is already a significant presence of women.

Before and during the implementation and maintenance of diversity ini-tiatives, there is also a clear necessity that the company monitors its numbers, analyzes the current situation and figures (Galbraith, 2010), such as the proportion of women at all organizational levels, in new recruitments, income inequality and promotion rates (McKinsey & Com-pany, 2007). The impact of diversity interventions must be consistently tracked, objectively measured and, additionally, tied with management compensation (Ettorre, 1992).

The importance of providing role

models for younger generations is sup-

ported by other authors, who argue

that women tend to move to firms

which have a corpo-rate reputation as “ woman friendly”.

The impact of diver-sity interventions

must be consistently tracked, objectively

measured and, additionally, tied

with management compensation.

88 Third Conference

Other specialists analyse the gap between theoretical models and re-search findings. Here, the argument is that a diverse workforce does not necessarily have a positive impact on organizational performance and what is needed is a reinforcing of other elements in order to analyze and implement diversity policies (Thomas and Ely, 1996; Jayne and Dipboye, 2004).This last analysis observes, for example, that without effective train-ing and development to support selection process, the increase in diversity does not automatically increase the talent pool.

Another point is that commitment, motivation and management of conflicts are not always positively affected by an increase in diversity as diversity is also associated with negative outcomes. In addition, diversity si seen by many researchers as something that improves some group processes but disrupts others. Furthermore, not all corporate policies towards diver-sity are effective and Dobbin et al. (2011) state that most of the actors involved are not aware of this inefficacy.

Work-life balance policies

The second theme is related to the policies that contribute to more balance between personal and professional life. This includes flexibility in working hours and career paths. The double burden is generally considered as one of the key obstacles for women in reaching higher levels in management (McKinsey & Company, 2007).

A study on the role of women and men in economic decision-making in Luxembourg (Lejeale, 2011) points out that the current profile required by companies for senior management positions is often incompatible with part-time jobs in that once a profession is associated with higher quali-fications, the lower is the proportion of part-time workers. Subsequently, the implementation of part-time jobs must also come with a change in the structure and culture within the organizations in order to ensure that women are no longer penalized in terms of promotion and compensation in case they need to make the choice for a part-time position.

Governments also have tools other than legislative measures such as female quotas to increase opportunities and support women’s position in the workplace. The Economist (2011) and McKinsey & Company (2012) identified the main tools. These are: non discriminating taxation against dual-earner families, reasonable maternity and paternity leave and a school system that allow parents to have both paid jobs and subsidised or tax-deductible child care.

Diversity is seen by many researchers as something that

improves some group processes but

disrupts others.

Current profiles required by companies for senior management

positions are often incompatible with part-

time jobs. The more a profession is known as more qualified; the

lower is the proportion of part-time work.

It is important to ensure that women are no longer penalized in

terms of promotion and compensation in case

they need to make the choice for a part-

time position.

Barriers and obstacles

An underlying objective of the majority of diversity programs implemented in organizations is to create awareness of discrimination and bias and to use this to improve the work environment and relationships. In doing so this helps to recognize the value of diversity for individual and group perfor-mance. This is a reaffirmation of the notion that a change in the mentalities and mindsets of employees and fundamentally in attitudes and behaviors of corporations’ leadership, is needed in order to adapt to the new realities (Thomas and Ely, 1996; Sacier-Sultan, 2012).

This may include challenging subtle acts or discourses of discrimination as evidence suggests that the hiring processes for top management posi-tions are more based on biases of decision makers than on measurable job qualifications. Also, the criteria for promotion are not always transpar-ent and equality based.They are often based on potential for men but on achieved performance for women (Goodman et al., 2003; The Economist, 2011).

There is also observed that there is a danger of “window dressing” when companies adopt diversity programs in situations where they might not to-tally accept the benefits but adopt diversity mostly in response to societal pressures. This can remarkably reduce the effectiveness of such initia-tives (Ettore, 1992; Dobbin and Kalev, 2011) or result in only superficial changes (Kirton and Greene, 2009) generating conflict, demotivation and low performance (Shen et. al., 2009).

Last, but not at least, arguments were identified during the conferences that suggest that women do not have the same willingness to follow suc-cessful careers. Nevertheless, significant references seem to exist, which affirm that, considering age and education, women and men not only have similar aspirations but also work-related perspectives which suggest that the absence of women is not due to differences in their work values (Good-man et. al., 2003).

There is a danger of “window

dressing” when companies adopt

diversity programs in situations where

they might not totally accept the

benefits but adopt diversity mostly in

response to societal pressures.

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The commitment to diversity

Independently of the reason why a company makes the decision to em-brace the diversity discussion within its organizational structure, a con-sensus exists about the importance of senior management commitment (McKinsey & Company, 2012). Decision-makers have a strategic impact on the way the company responds to the pressures to implement meas-ures (Ng, 2008) and the leadership must be convinced about the relevance of managing diversity (Ollapally and Bhatnagar, 2009).

As it is frequently argued, (Ng, 2008; Cox and Blake, 1991; Aiken and Kel-ler, 2007), despite environmental pressures and human resources efforts, the commitment of decision-makers is critical in diversity and decisive to successful long-term diversity programs. They are responsible to foster an organizational culture that not only recognizes the importance of diversity but also the learning opportunities that stimulate personal development and openness and encourage expression (Thomas and Ely, 1996; Shen et. al., 2009). Additionally, not only the top management must be engaged in diversity programs; the whole organization must be an environment where diversity issues are considered as strategic.

In addition, the corporate culture of a company regarding social norms is more important than its need to implement workforce diversity initiatives. This means that a company with poor diversity records is less likely to adopt programs, even with external pressures which reinforce the role played by organizational culture as a determinant of successful initiatives (Goodman et. al., 2003).

The commitment of decision-makers

and leadership is critical and

decisive to successful long-

term diversity programs.

The whole organi-zation must be an

environment where diversity issues

are considered as strategic programs.

This section does not intend to be comprehensive in covering all the pos-sibilities and challenges faced by managing diversity, but to show some common aspects that are recurrent not only in academic studies but in the business environment. As presented in this framework (Exhibit 27), from the moment a company recognizes the need to manage diversity, the entire structure must be aligned to properly communicate, identify and im-plement suitable measures, involving strategic leadership, organizational culture and the generation of employee engagement – all of which adds value to the organization.

Exhibit 27: Aligning an organizational structure for managing diversity

Source: adapted from Ollapally and Bhatnagar,

2009, p.467

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EmployeeEngagement

Organizational Strategy

Leader

Socio cultural attitudes

Organizational

Culture

Awareness of the need

HR Policies Practices

Diversity Management

EmloyerBranding

Turnover

The fourth and final conference of the Fedil initiative for Gender Diversity, held on June 4th, discussed the effect of gender diver-sity on branding. The keynote Speaker, Ursula Schwarzenbart, and the panelists moderated by Jacques Lanners, debated how the organizations position themselves regarding diversity not only in terms of internal talent management, but also to enhance the rela-tionships with external stakeholders.

Ursula Schwarzenbart – Director Global Diversity Office, Daimler AG

Jacques Lanners – Director representative at Cératizit S.A. and Chairman of the Supervisory Board at Cératizit Luxembourg.

Hubert Clasen – Manager, Caves Bernard-Massard S.A.Eva Ferranti – Owner-manager, Eva Ferranti S.A.Françoise Folmer – Partner, Team 31Marc Gerges – Partner-Editorial and Communication Manager, Maison Moderne Publishing S.A.Robert Goeres – Managing Director, Goeres HorlogerieKatia Scheidecker – Partner, Cabinet MNKS

Keynote Speaker


Panelists

Fourth Conference4th June 2012

Branding, Corporate Image and Market OrientationDefinition

Branding aims to establish a significant and differentiated pres-ence in the market that attracts and retains loyal customers. Branding is the process involved in creating a unique name and image for a product in the consumers' mind, mainly through adver-tising campaigns with a consistent theme (http://www.business-dictionary.com/definition/branding.html, 2012).

Corporate image is the mental picture that springs up at the men-tion of a firm's name. It is a composite psychological impression that continually changes with the firm's circumstances, media cov-erage, performance and pronouncements. Similar to a firm's repu-tation or goodwill, it is the public perception of the firm rather than a reflection of its actual state or position. Unlike corporate identity, it is fluid and can change overnight from positive to negative to neutral. Large firms use various corporate advertising techniques to enhance their image in order to improve their desirability as a supplier, employer and customer (http://www.businessdictionary.com/ definition/corporate-image.html, 2012).

Corporate reputation is a perceptual representation of a company’s past actions and future prospects that describe the firm’s overall appeal to all its key constituents when compared to other leading rival’s. (Fombrun, 1996, p.72, cited by Brammer et al., 2009)

Market orientation is understood as the ability of a company to offer products and services tailored to a specific segment (Davis et. al., 2010).


During her presentation, Mrs. Schwarzenbart explained how the diversity issue has been developed by Daimler. As a large and international com-pany, with a headcount of more than 270 000 employees worldwide, she referred to the fact that eighty per cent of the company’s revenues are generated outside Germany, which highlights the need to include and inte-grate international talents in the organization.

She continued: As the majority of all car purchases worldwide are influ-enced by women, and female income is expected to reach 18 trillion US dollars in 2014, there is no question about the impact of women in terms of labour market involvement and consumer purchase decisions. An efficient and successful organization should, therefore, integrate and reflect this market orientation into the organization by increasing the participation of women in management. This is especially the case because, as discussed earlier in this report, within the car industry sector (and also with Daimler), engineering positions are mostly occupied by men.

As founder of the Global Diversity Office in 2005, the speaker detailed the company’s target to reach 20% of executive positions to be occupied by women by 2020. Since 2006, when this number represented 6%, the first woman was added to the Board of Directors. In her overview of meas-ures under diversity management at Daimler, she highlighted the setting of guidelines, the importance of workshops and mentoring to deal with bias, the development of resource groups, job & family initiatives and the importance of communication through which the personnel know where the company is and the goals that must be reached. Moreover, the need to involve men in the initiatives was considered crucial as well as the connection of diversity performance indicators to annual bonuses as a motivation’s driver.

Mr. Lanners raised questions which stimulated the panelists to reflect on the importance of diversity for the company’s image. He also consulted panelists’ opinions about the effects of women’s presence for the internal and external environments of organizations, for the employment market and the association with a company’s marketing strategy and product development.

Mrs. Ursula Schwarzenbart Daimler

Mr. Jacques Lanners Cératizit


96 Fourth Conference

Despite the fact that his sector is mainly occupied by men, Mr. Clasen considers women’s presence within the company to be very positive. In his view, women may add different perspectives and help the company with critical points of view.

As some of their products have women as the main consumer, he ex-plained how the company chose to integrate the female element for the product creation and development, and additionally to involve an advertise-ment company with experience in female buying habits and markets.

A balance between men and women is ideal, according to Mrs. Ferranti. She expressed her willingness to add more men to the staff, but spoke about the difficulty in finding male applicants. Nevertheless, she is very clear: the main points are competence and talent, and these must lead the search for professionals, not gender per se. As a tailor-made clothing producer, this sector has changed, moving from a male dominated area to massive female participation in the last decade.

Mrs. Folmer’s experience relates to the construction sector where mas-culine strength and physical work is required. It is these issues which constitute a barrier to a more gender balanced personnel. She recognizes, however, the positive effect on male behavior of including female presence.Additionally, she mentioned that advertisement campaigns have a pow-erful effect in changing mentalities and in challenging the stereotypes embedded in society which work as a barrier for diversity.

Mr. Hubert Clasen Caves Bernard-Massard

Mrs. Eva Ferranti Eva Ferranti

Mrs. Françoise Folmer Team 31

Paperjam is seen as a magazine for businessmen. Despite such a mas-culine profile, Mr. Gerges considers that the company should be rather a reflection of society. He believes that diversity is associated with the firm’s credibility and, therefore, the actions must be coherent with the values disseminated by the company.

Mr. Goeres drew attention to issues of complementarities in gender di-versity. He sees diversity as an opportunity for a balanced team which is more productive and effective. His staff is mostly female and the balance that they would like to achieve would be to have a greater male participa-tion. On the debate about women’s purchasing decisions, he shared his experience with an internal survey conducted by his company. This survey identified a balance in the sales for female and male clients but 83% of women claimed to have made the purchasing decision against men who claimed approximately only 65% ownership of the purchasing decision.

Mrs. Scheidecker shared her story of founding the company with another woman, and how this worked as an attraction for other women employees in joining the company. She considered that one of the reasons is the fact that these female professionals may expect to be recognized properly and could see more opportunities with a company managed by women. They have also attracted many clients because the senior partners are women. Following the company’s growth and the widening of the customer base, they consider it important to adapt the company to the market and reflect internally the diversity of their clients.

Mr. Marc Gerges Maison Moderne Publishing

Mr. Robert Goeres Goeres Horlogerie

Mrs. Katia Scheidecker MNKS Law Firm


Women and purchasing decisionsCompany’s image and credibilityAssociation between gender and marketing strategyImportance of balanced teams

The many benefits of diversity for business have been discussed and ana-lyzed earlier in this report. However, this section aims to discuss the ben-efits related to a company’s reputation as well as marketing opportunities and orientation(s).

The relationship between diversity policies and corporate image

Several studies address the relationship between female presence on the board of directors and external recognition or image. For example, Bear et al. (2010) examined the variables that can be associated with positive reputation, such as profitability and risk, media visibility and customer satisfaction. With the increase in discussion about gender diversity on cor-porate boards, it is expected that the board composition also affects repu-tation as it shows the importance given by the firm regarding initiatives to increase female participation which act as positive indicators for external evaluators. Their research findings support the fact that gender diversity at the level of boards may enhance corporate responsibility because women bring increased sensitivity to issues of corporate social responsibility and participative decision-making styles which influence corporate reputation. Similar findings were identified by Roberson and Park (2007) who claimed that organizations which are recognized by their diversity initiatives and management benefit from economic advantages. It is argued that diver-sity reputation, i.e. being recognized as one of the leaders in this area, is positively seen by investors and may enhance their valuation, and, subse-quently, financial performance.

Brammer et al. (2009), on the other hand, showed the reputational effect associated with the presence of women, which varies across sectors and which is only considered favorably if there is closeness to the final custom-er. Although it is important to mention that this reputation is also affected simultaneously by other factors, for instance, financial performance, mar-ket risk, the extent of long-term ownership and the nature of the activities.

A study conducted by the European Commission (2003) in a wide range of companies and institutions measured the effectiveness of diversity

1.2.3.4.

Gender diversity “helps bring the company, closer

together, its employees, its

shareholders and its customers”.

Almost 70% of the respondents

affirm that diversity initiatives enhanced corporate reputation


policies and almost 70% of the respondents affirmed that diversity initia-tives enhanced corporate reputation. A significant proportion identified an improved marketing image, access to new market segments after the program’s implementation and an enhanced reputation with governments and stakeholders. For McKinsey & Company (2007, p. 10), gender diversity

“helps bring closer together the company, its employees, its shareholders and its customers”.


one of the reasons that lead, for example, one of the world’s largest retail-ing companies, Wal-Mart, to double the investment in training and pres-sure on suppliers to employ a higher percentage of women. The company is understood to be attempting to rebuild its image after an action brought by employees to the US Supreme court for gender discrimination (The Economist, 2011).

“Organizations are realizing the benefits of a diverse workforce with re-spect to access to a wide range of information, better decisions, better problem solving and more innovation. They are seeing a direct impact on the bottom line, besides the fact that it increases the brand image of the organization.” (Ollapally & Bhatnagar, 2009, p.455)

Bernardi, Bosco and Columb’s (2009) analysis on Fortune 500 companies and the World’s Most Ethical companies show that female participation is higher in those companies that have higher ethical practices. And since other studies have built an association between women’s presence and increased corporate social responsibility, it is possible to argue that ethi-cal behavior in organizations is strongly related to female participation on boards of directors. A final conclusion cannot be drawn however; as it may be argued that more ethical companies hire more women, rather than the other way round.

Market opportunities and female consumerism

Once the association between diversity and corporate image has been traced, it is also possible to reflect on its importance as an enhancer of market opportunities. The implications are mainly related to a better mar-ket segmentation, improvement on customer satisfaction and expansion of their services and products. Recent statistics show that in Europe and America women are responsible for around 70% of all home related purchases (The Econo-mist, 2011) and make 80% of all consumer goods decisions (Cunningham and Roberts, 2006). Consequently, it is reasonable to reflect on the fact that when women are brought into a company’s board of directors, they may add new experiences, new perspectives about customer behavior and, consequently new ways to develop products and services, based on their knowledge of consumer’s needs and choices (Singh and Vinnicombe, 2004; European Commission, 2012b). Female presence at strategic de-cision-making levels is critical in markets with a higher concentration of female buyers or in markets which are historically associated with male consumption, but where the percentage of women involved in buying deci-

It is possible to argue that

ethical behavior in organizations

is strongly related to female

participation on boards of

directors.

In Europe and America, women

are responsible for 70% of all home

related purchases and make 80% of all customer good decisions.

Women are the fastest growing

segment of buyers.

It is argued that companies seek external validation of their diversity prac-tices, clearly presenting diversity as a corporate strategy or goal in their public statements or internal policies (Farrel and Hersch, 2004). In addi-tion, they use it to reach recognition and to “disclose” their awards and progress, raising their importance in society and participation in networks and events (European Commission, 2007). This has been concluded as

100 20 30 40 50 60 70 80

Source: European Comission (2003/based on CSES Survey

of Companies)

% of companies identifying benefit

as important or very important

Exhibit 28: Companies with Active Diversity PoliciesBene�ts Gained

Strenthened cultural valueswithin the organisation

Enhanced corporate reputation

Helped to attract and retainhighly talented people

Improved motivation and efficiency of existing staff

Imporved innovation andcreativity amongst employees

Enhanced service levels andcustomer satisfaction

Helped to overcomelabour shortages

Reduced labour turnover

Lowered absenteeism rates

Improved access tonew market segments

Avoided litigation costs

Improved globalmanagement capacity

sion is increasing. One example is the automotive industry, where women represent 52% of buyers in the US and influence more than 85% of all purchases. This leads Dychtwald (2010) to argue that women are the fastest growing segment of buyers.

Some of the brands that have a strong male image have been trying to adopt a more gender-neutral branding strategy in order to face the increas-ing importance of women as the target audience (Exon, 2003). According to these authors, life-style performs a more important role than gender, although female-friendly designs have become more frequent. An example cited by a European Commission report (2007), explains the success of a female designed vehicle by a famous car manufacturing company that was originally designed with women drivers in mind but which, through such an inclusive approach, could develop into wider acceptance. This is in contrast to some arguments whereby companies are seen to underesti-mate the female audience by applying a masculine perspective to feminine marketing enigmas (Cunningham and Roberts, 2006).

Davis et al. (2010) move the discussion further and affirm that female-led firms are more market oriented than male-managed firms. This would generate indirect effects on company performance. Their results imply an effect of the manager’s gender on the perception of their customers and employees regarding its market orientation. Similarly, gender and person-ality are believed to affect the interaction of product development and customers’s preferences (Moss, 2007). This suggests that an alignment between the product and consumer’s self-image must exist and the gender incongruence may constitute a barrier to this alignment. When a company recruits people whose values reflect exclusively the values of senior man-agement than those of the clients, it may lead to a discrepancy between internal and customer’ values. The Exhibit 29 shows how these elements connect in order to lead to the purchase decision.

Female-led firms are more market

oriented than male-managed

firms.


Purchasing

Preference aestheticsinfluenced by personality

and gender

Production aestheticsinfluenced by personality

and gender

Interactive effect of secmentation variables (personality and gender)with like attracting like

Positive liking

Greater attention

Exhibit 29: Web of interactions creating congruence between product and customer preferencesSource: Moss, 2007

Internal diversity, therefore, could enable organizations to gain competitive advantage through a more efficient handling of the consumer market (Bili-moria and Piderit, 1994 in Bernardi et al., 2009). This is already a strong reason for companies to become aware and receptive of the importance of a more gender balanced organization.

All the findings outlined in this report identify that women provide comple-mentary skills for an organization and that it is important to work on equal gender treatment in the work place.

Gender diversity matters have been discussed for many years and the situation has not improved significantly. For this reason, some countries have decided to take the issue more seriously and implement stricter gov-ernmental regulations, such as legal quotas.

Quotas are, therefore, one of the most pressing issues nowadays for gov-ernments. Opinions about regulation differ from one country to another. Some countries decided to adopt legal quotas with sanctions (France, Italy and Belgium). Other mechanisms can be found such as “comply or explain” (The Netherlands), the imposition of rules concerning only state-owned companies (Denmark, Finland, Greece, Austria, Slovenia), state voluntary targets (UK) and charters that companies can sign up to (The Netherlands, Denmark). Companies and governments in other countries who are still undecided are involved in wide-ranging debates which address the pros and cons of the adoption of legal quotas. A recurring argument against legislative measures lies in the fact that the quota system does not ad-dress other levels within the organization, including female representation at the executive committee level. Therefore, such quotas do not address the need to increase the representation along the entire organizational structure (OECD, 2011; McKinsey, 2012).

Governments also have tools other than the legislative measure of female quotas to increase opportunities and support women’s position in the workplace. The Economist (2011) and McKinsey & Company (2012) iden-tified the main ones: reasonable maternity and paternity leave, a school system that allow parents to have both paid jobs and subsidised or tax-deductible child care.

With regard to Luxembourg, as we saw in the first chapter of this report, the proportion of women on boards of directors as well as the results of our survey show that Luxembourg is only in the early stages of gender diversity and that there is progress to be made. Having said this, many Luxembourg companies are actively supporting gender awareness programs and initia-

Conclusion

tives to change mindsets and organizational cultures that work against gender diversity. The question is, how fast and how strictly to proceed?

With regard to Luxembourg, the situation with women on boards is a seri-ous one. In spite of this, however, all the panelists at the Gender Diversity conferences, regardless of gender, did not approve of enforcing companies by way of legal quotas to appoint women to the boards. One of the explana-tions put forward by the female participants is that women do not want to be appointed into senior roles only because of the quotas; they would pre-fer to be appointed through merit and talent and because they deserve the role. Furthermore, all the speakers were clear in their message that when hiring new employees and appointing to the board, the most important criterion is to hire the best talent. This perspective was also held by those in sectors that are traditionally more male-dominated, such as technology companies or the construction and car industry. Here, it was argued that it is important to make the industry more attractive to diverse groups of people, through more flexible forms of working, more role models, greater support on the job and to change the mindsets of young people by provid-ing wider career information and choices. Access to higher education in fields such as engineering and management in particular needs to be im-proved and so does attracting talents to these fields. However, to change perceptions and stereotypes we need to start from childhood (McKinsey & Company 2007).

A lot of the speakers also mentioned that one of the main barriers to gender diversity in employment (but especially in promotion situations) is that women often do not project themselves and frequently underesti-mate the skills they have to offer. It was commented how men, in general, have less hesitation in evaluating or promoting themselves and how they advance faster in their career contrary to women who tend to go step by step through all the layers in the company. Thus, a more confident evalu-ation and recognition in the skills that women bring can play an important role in overcoming narrow perceptions and helping recruiters to value non-standard CVs and the breadth of experiences that a person can offer. Companies should also actively target women in their organization, who have the right skills and experience, to discuss their intentions for promo-tion and taking on more responsibilities.


106 Conclusion

Drawing from the panel discussions and the range of themes discussed in the literature review, the following recommendations and outcomes from good practice across Luxembourg firms can be identified.

Key messages

1. It is important to have competent and talented people regardless of gender and this should lead the search for professionals.

2. Women are not a commodity with which to add value to the company. Women bring “complementary value”.

3. Women should not be treated as “victims” that need help.

4. Diversity has multiple facets, such as cultural and age diversity and all of them are important.

5. Diverse teams have better results and can increase performance.

6. Gender diversity is not just about women. Men should be engaged in gender initiatives to create involvement, inclusiveness and greater awareness.

7. Recognize non-standard CVs and the range of experiences through which women can demonstrate different management styles, ideas and ways of thinking as well as displaying strengths in listening skills or abilities in motivating staff.

8. Note that without effective training and development to support se-lection processes, the increase in diversity does not automatically increase the talent pool (because diversity is seen for many research-ers as something that improves some group processes but disrupts others).

9. Acknowledge that diverse groups can also experience more process problems than homogenous groups such that different types of diver-sity can cause various kinds of conflicts and the way in which a diverse group solves these conflicts demonstrates how effective diversity of this group is.

10. To help with diversity conflict (whether gender related or otherwise), implement organizational development activities, such as team build-ing, survey feedback, process consultation, and intergroup dynamics as these are believed to improve organizational performance.

11. Policies must not only be fair in terms of giving equal opportunities, no matter the gender, but also promote a gender-friendly environment that enables women to be attracted to that sector.

12. It is valuable to have attractive working environments and flexible work-ing policies (in work hours and career paths) that contribute to more balance between personal and professional lives and greater support for the career paths of part time workers.

13. There is a need for more prominent reference points (in leadership and management) for women in the work place (as well as enhanced men-toring, coaching, training and networking opportunities for women)

14. Hiring processes for top management positions should be based on measurable job qualifications and attributes/skills required to under-take the job.

15. Women should let their employers know that they are ready for promo-tion and organizations should actively seek out candidates with the right skills for promotion.

16. Avoid a “window dressing” approach when adopting diversity pro-grams. This can markedly reduce the effectiveness of such initiatives.

17. To change the level of gender diversity awareness, the head of the business must understand and support the concept of diversity.

18. Clearly present diversity as a corporate strategy and make it visible in public statements, mission statements and other internal policies.

19. Reinforce the role played by organizational culture as a determinant of successful initiatives. Culture is important for changing dominant norms or “mindsets” regarding diversity issues.

20. Develop and use clearly monitored data on the proportion of women at all levels of the organization, as well as data on new recruits, pay differentials between women and men exercising similar functions, and promotion ratios.

21. The impact of diversity interventions must be consistently tracked and objectively measured and, additionally, tied with management com-pensation.

22. Governments might contribute with tools other than quotas: reason-able maternity and paternity leave, a school system that allows par-ents to have both paid jobs and subsided or tax-deductible child care.

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