Deutsche Telekom Introduces Women ’s Quota

Deutsche Telekom has been the first DAX 30 company to establish a quota for women: By the end of 2015, 30 percent of upper and middle management positions in the company are to be filled by women. This is a Group-internal requirement and applies worldwide. René Obermann, Chairman of the Board of Management of Telekom, summed it up as follows: “Taking on more women in management positions is a matter of social fairness and, above all, a categorical necessity for our success. Having a greater number of women at the top will simply enable us to operate better.”

We firmly believe that our company will benefit from having more women in management. Extensive research shows that mixed teams are not only more innovative but also more productive and more successful in business. Companies with a large proportion of female managers generate new cultural and financial value. Studies confirm that companies with a higher percentage of women achieve significantly better results and greater profitability. What is more, investors and funds are increasingly looking for sustainable business practices that include gender equality. These are concrete economic arguments for putting more women in management positions.

Women remain underrepresented at all management levels of our company. Compared with the other DAX 30 companies, the numbers at Telekom are average. In the last decade, the percentage of women at the top management level in large German enterprises has only risen from around 5 percent to just under 5.8 percent. At Telekom, 9.6 percent of upper management positions were filled by women in 1996. Today, this stands at 12.5 percent.

Although Telekom has spent many years initiating and implementing extensive measures designed to promote the interests of women, this did not bring the success we had hoped for. The “glass ceiling” could not be broken, which is deeply unsatisfactory. For this reason, we have now decided to take another approach by making a binding commitment. This is down to the fact that traditional roles, entrenched hierarchies, old boys’ networks, and ingrained mentalities cannot be changed by good intentions alone. We have learned this from the past.

We believe the women’s quota is also the right response to the medium-term development we are seeing on the labor and talent market. Already, more than half of all business graduates from German universities are women. We can already expect a future shortage of specialist workers, which will impact the economy and thus also the business world. One example of this: The OECD states that, in the year 2020, there will probably only be seven young engineers for every ten engineers approaching retirement. Unless companies get actively involved in making sure this is not the case, these seven female engineers will be rarities. The biggest challenges lie firstly in getting girls interested in and encouraging them to pursue mathematics and science-based subjects, and secondly in making young women aware of the vast range of career opportunities open to them in business. These are precisely the objectives of our diverse range of STEM initiatives, which are already in full swing. The women’s quota sends out a clear signal to females that they can start their careers with Telekom. This will also make the quota commitment a key part of our strategic workforce restructuring activities. It will help us greatly expand our talent pool in a meaningful, fair, and sustainable effort to win tomorrow’s young management hopefuls.

Potential assessments, selection processes, and development forecasts must take place openly and transparently. When filling management positions at Telekom in the future, women must make up at least 30 percent of the applicants shortlisted.

But this is all an exercise in futility if no solution is provided to the overriding question of how women and men can achieve a healthy work-life balance. This is why we have substantially extended the support we offer in-house with childcare and care for the elderly. By actively maintaining contact with employees during parental leave, and using individual reintegration measures, we are also making the transition back to working life easier for women and men.

We have just introduced a policy designed to increase acceptance of – and even expressly encourage – leadership on a part-time and remote basis in order to maintain a healthy work-life balance. After all, a part-time leadership model is also an excellent HR development tool. It enables executives working part-time to systematically mandate junior talent with taking on increasing leadership responsibility locally. Last but not least, greater control over working hours also calls for a second policy, which we have just introduced. This sets out rules on the use of and attitudes toward mobile work resources outside of normal working hours.

Internal and external reactions to the women’s quota at Telekom indicate that the Board of Management’s decision to introduce a quota was the right one. In the future, a lot of able, well-qualified women will have significantly better career prospects with our company and will occupy a larger proportion of positions in leadership. We will only have reached our ultimate goal when the women’s quota becomes redundant. It will be some time before this happens but we have now taken the first big step.