Female Leadership: Empowering Diversity in Business

The Importance of Female Leadership in Modern Business 

On LinkedIn, in newspapers, journals, in the public discussion, and scientific as well as private, company financed research, Female Leadership, Women Empowerment, the claim for women in Boards, academies, coaches and networking groups are omnipresent nowadays.

The intensifying call for DEI, Diversity, Equity and Inclusion becomes an integral part of sustainability. The concept of sustainability has evolved beyond its traditional focus on environmental issues to include social and government aspects, often summarized as ESG – Environmental, Social, Governance. DEI fits within the social component of ESG.

Social responsibility promotes the fair and equitable treatment of all individuals, which is essential for a just, equitable and inclusive society.

Employment Disparities Across Europe: A Snapshot 

In Germany in 2022 about 41,1 Million people between 15 and 65 years old were employed with an employment rate of 73,1% for women and 80,6% for men.

In other European countries the employment rate between men and women varies. In Italy, Greece and Romania the difference lies between 17 and 19%, in Scandinavian countries the gap is far less. 

A study of the German “Arbeitsagentur” (http://statistik.arbeitsagentur.de) states that generally the percentage of people employed has risen. However, there are differences between men and women. 2/3 of the self-employed and independent are men. More than 50% of employees subject to social insurance are men whereas the so-called Mini jobs are mostly a female domain, same for parttime work. Much more women are responsible for and take care of one or more children besides having to work or having to look for work. The gender pay gap in Germany 2022 lies at 18% and on average men gain more than women. Women are more subject to age poverty. As women work over proportionally in the tertiary sector the restrictions during the pandemic hit harder on their economical situations.

Industries like education, healthcare and social work are more female occupancy areas while construction, logistics and the manufacturing sector are occupied by men. The percentage of women in MINT professions lies at 17%.

Underrepresentation in Leadership Roles 

In boards and leadership roles women are highly underrepresented in Germany.

Only 28% are women. The gender pay gap in leadership and board roles is more accentuated with 25% less for women in the same positions. According to the Arbeitsagentur this may be due to the fact that mostly young female academics enter in new management roles. As they lack experience they are paid less.

Gender pays gap and absence of women in leadership roles and boards while the population consists of more women than men in Germany.

The “Social” of ESG is neglected when it comes to gender specific diversity between men and women.

The reasons and roots have to be discussed in a critical and objective way considering societal, educational, cultural and biological factors.

Gender biases, stereotypes about gender roles, organizational policies and practices may not always support or encourage women´s advancement to leadership positions.

Legislative Efforts and Progress in Female Leadership 

In 2015 and in 2021 in Germany the FüPoG (Führungspositionen-Gesetz) was introduced. The law requires more women in public services and more female officials in committees of the Bundestag and supports parity in leadership roles. Till 2025 the Bund aims at an equal occupation in public service.

The private sector works differently. The aim is to maximize profit, foster growth and innovation. Women can become pregnant which reflects an economical risk factor for a company. To have children is still perceived as an economical and organizational drawback for a single company. Women may be more likely to consider part time work in order to stay with their children. They embrace the physical responsibility to be there and adapt accordingly. Our society still functions in this way, even though this may slowly change. Why are still so few women in leadership roles that we need to determine a proportion? Why do we have a “Glass Ceiling Effect”, meaning that women have to face challenges that men do not when attempting to advance their careers? Why is there a lack of support and recognition, a gender imbalance in promotions?

Unique Leadership Traits of Women in Business 

Let us focus on constructive aspects.

Men and women in leadership assessment often exhibit different styles and approaches:

1. Leadership Style

Women are seen as more transformational leaders focusing on development, mentoring and inspiring their teams. Men, on the other hand, may be more likely to use transactional leadership.

2. Decision – Making

Women leaders are often perceived as more collaborative and inclusive in decision-making, seeking input and consensus. Male leaders might lean towards a more decisive and direct approach.

3. Communication

Women in leadership roles may exhibit more empathetic and nurturing communication styles. Men, conversely, might communicate in a more assertive and direct manner.

4. Risk – Taking

Male leaders are often seen as more willing to take risks, while women leaders may take a more calculated approach to risk.

5. Emotional Intelligence

Women leaders are frequently recognized for higher emotional intelligence, with a greater focus on empathy and understanding the emotional needs of their team.

6. Motivation and Influence

Women may be more motivated by communal success and the welfare of their team, whereas men might be more driven by personal achievement and status.

7. Conflict Resolution

Women might approach conflict with a focus on finding mutually beneficial solutions, while men may take a more competitive stance.

These are general observations, and they can vary greatly depending on the individual leader.

Furthermore, the effectiveness of different leadership styles can be context-dependant and not necessarily linked to gender alone. The requirements to be effective change with the context, project, problem.

Leadership effectiveness is about the skills and competencies of the individual.

However, the success of a growing, innovative company depends on more than one person. A leader can only be as good as the people, products, services, ideas and organization around him; he needs a team.

The Case for Diverse Leadership Teams 

High-performing teams in leadership are characterized by an effective team composition and dynamics. The key factors are:

1. Optimal Team Size

A team should neither be too small as this is limiting diversity and bandwidth nor too large as sub-teams may be built and decisions become more difficult.

2. Diverse Skills and Attitudes

Members of a team should bring complementary skills and attitudes. Innovation takes place through ideas, their evaluation, different points of view and constructive communication, “out of the box” thinking, courage, critical thinking as well as determination.

3. Quality of Interaction

Trust, open communication, and embracing conflict are crucial for high-quality interaction.

4. Alignment on Direction

Teams need a shared understanding of the company´s goals and their role in achieving them. Teams should be energized and willing to innovate, take risks and achieve significant goals.

5. Reflective Sessions

These focus on team dynamics rather than business problems. It is crucial to fostering trust and appreciation for diverse opinions and stay open.

These key factors for high-performing teams are based on diversity and different soft-skills.

To enhance success, innovation and growth it seems obvious and essential to have a diversified leadership. This does not correspond the leadership reality in Germany.

We have to reflect on our leadership and leadership systems in a critical way.

We have to uncover the roots of inequality and lack of gender diversity.

We can only get better.

Diversity is being invited to the party; inclusion is being asked to dance - Verna Myers about diversity in business