Diversity is an issue that can no longer be ignored – especially not in human resources. Nevertheless, many German companies – mid-sized companies in particular – have difficulty embodying diversity among their employee base.
Why? And what can executive search consultants do to ensure that companies are not just paying lip service when it comes to diversity? Journalist Julia Gundelach and Gerlinde Berger, partner at DHR Global, met to discuss diversity in the workplace.
JG: Ms. Berger, your motto is that diversity is more than just a gender quota. So what does diversity mean to you? And why is it more important than ever?
GB: My personal definition of diversity is very simple: diversity is variety. A variety of different types of people, backgrounds, ways of life – diversity must reflect society. And, naturally, that goes well beyond considering whether a person is male or female. It’s extremely important that companies take this into account. On the one hand, there’s the economic factor: companies that demonstrate diversity perform better on the market. But there’s also a societal aspect. We want to encourage diversity within society and that means allowing for it within companies. Employees need to feel good about where they work. Today, this means that diversity is an essential starting point for employer branding.
JG: Could you explain why diverse companies perform better than other companies?
GB: Well, one example is how decisions are made. Diverse companies allow for a variety of opinions and points of view, which means decisions are broader and more forward-thinking. These companies are more innovative and they reflect our society more accurately. This promotes teamwork, which increases productivity and, in turn, profits.
JG: You have been working in executive search and leadership consulting for more than 20 years. What role did diversity play when you were getting started? And how have things changed since then?
GB: Twenty years ago, it didn’t play any role at all, at least not in Germany. Executive searches were focused on typical white men over 50 – and they still are, in many cases. About ten years ago, people slowly started to talk about gender quotas. And a great deal of progress has been made in recent years. However, although there is now a lot of talk about diversity, there is still very little action. At least these days diversity is a selection criteria considered by almost every company when looking to fill new positions – even though they mostly still ‘only’ look at gender. But we’re heading in the right direction.
JG: Your main focus is the automotive and mechanical engineering industries and you recruit for very high-powered positions. Is it harder to achieve diversity in those industries than it would be for positions in the luxury goods or FMCG segments?
GB: It is harder to find truly diverse candidates for certain positions in traditional industries. Executive search consultants in these areas are under more pressure than in other segments and the focus is still usually solely on gender. If we cannot find diverse candidates for top management positions, we have to balance this with more diverse hires at other levels so that we still end up with a diverse team.
JG: How do you go about searching? Diversity can’t be the only criteria considered when filling a new position?
GB: You have to find decent middle ground between being pragmatic and filling quotas, which requires very specialist expertise. It certainly can’t happen overnight. We observe the market very closely, spend years creating diverse pools of candidates and take the time to stay in touch with various communities and networks. For some positions, only a few candidates are eligible and they are highly sought after.
JG: Assuming two people have identical qualifications, does the diverse candidate have a better chance of getting the job?
GB: That’s what you often hear from candidates who aren’t considered diverse. But I take a pragmatic view of the situation. For years and years, typical, middle-aged, white men were at an advantage when it came to being hired and anyone who didn’t fit that category was at a disadvantage – now the tide is turning.
JG: If we come back to this issue in a few years, what do you think will have changed?
GB: We are still only really at the outset. Diversity will continue to grow in importance in Germany in many sectors including recruitment. It’s very important that we hire people who reflect the make-up of our society and foster inclusion. And we will get there.
JG: Has the coronavirus boosted the relevance of diversity? Do you think that social distancing helped us to realise the importance of society and interaction?
GB: Definitely. The crisis proved that we really have to take the circumstances of every individual into account – maybe a person has a cruelling commute or maybe they need support because they have to care for a sick family member, for example. The pandemic has made a lot of people more open about their struggles.
JG: How diverse are German companies and how do they compare on an international level?
GB: We really still have a lot of work to do. Large corporations are starting to establish structures and create internal diversity roles. These companies recognise the need for diversity, but it’s unclear whether they are motivated by internal forces, regulatory concerns or external pressure. Diversity is often just not an important topic at all at a management level. But it’s management that really needs to be thinking about it. After all, employer branding is more important than ever before in light of the massive labor shortages. The USA is ahead of the game. There, diversity is not a nice-to-have, it’s essential! Society there is miles ahead, thanks to the civil rights movement, awareness of discrimination of people of color and the events surrounding the death of George Floyd and so on. And not least because companies also have to be more careful about protecting themselves from discrimination complaints.
JG: Is diversity in Germany a must-have or a nice-to-have?
GB: It’s a must-have here too. But many companies just aren’t aware that this is the case. We are in the middle of a war for talents and companies who want to remain viable in the future have to act. Otherwise they will fall behind, fail to attract talent, have problems convincing people that they are good employers and, of course, they will be considered rather old-fashioned.
JG: So what’s stopping them from focusing on diversity?
GB: Often they are missing a consistent strategy or other issues take priority. A single event promoting diversity is not enough: companies really have to demonstrate diversity in every aspect of the business. In many cases there aren’t enough people or resources allocated to promoting the issue. And of course language is a problem. English should be the default corporate language but that’s usually not the case. The language barrier alone is often enough to rule out international candidates. Many mid-sized companies really struggle with this. We advise them to push the boundaries of their own comfort zones and to engage with international candidates and new languages. The pool of truly excellent candidates expands if companies are open to diverse hires. Or to put it another way: companies that don’t speak English are no longer really viable.
JG: What role does diversity play at DHR and how does the company embody diversity?
GB: Diversity has always played an important role here and this has really been intensified in recent years. We exchange views and information with our colleagues in the USA. We have established committees at the highest management level, we have diversity councils, we are committed to making diverse placements, we have regular jour fixes on the topic and diversity is one of our success metrics. In fact, it’s now our most important measure of success in situations where we can assume all other qualifications have been met, as is the case at an executive level Diversity is now part of our DNA and much more than a buzzword. We talk about it every day.
Meet the Author
Gerlinde serves as a Partner in the Industrial and Consumer/Luxury Goods Practice in Europe. She is based in the firm’s Vienna, Munich and Frankfurt offices, serving her client base in the DACH region.