Study on statutory quotas for women in management positions

Statutory "women's quotas" are on the rise in Europe. Austria also introduced such a quota for supervisory boards in 2018. "Here we see that while legal quotas increase the proportion of women on directly affected boards, the reasons for women's low participation - e.g. the male-dominated role model of the manager - do not disappear," explains Heike Mensi-Klarbach from the Institute for Gender and Diversity in Organizations at WU. "In Norway, the pioneering country in terms of women's quotas, the quota has indeed ensured more women on supervisory boards. However, nothing has happened on company boards." With 'hard' measures such as quotas apparently failing to bring about lasting cultural change, the researcher looked at how effective 'soft' measures, i.e. measures away from legal requirements, are. These are more likely to be seen as having the potential to be effective in the long term.

Pressure through clear targets and the threat of quota
Together with two WU colleagues, Mensi-Klarbach researched the impact of the Austrian Corporate Governance Code's (ÖCG-K) recommendation for gender diversity on the supervisory boards of listed companies and the role played by the public discussion surrounding the threat of a statutory women's quota by the legislature. It became clear that while the guideline in the ÖCG-K, with its vague formulation that gender diversity should be 'appropriately taken into account', had no effect on appointments, the number of women increased significantly during the public discussion surrounding the introduction of the women's quota. "However, this effect was only evident as long as the introduction of a women's quota was a realistic scenario. When the quota was off the table for the time being, it disappeared again," Mensi-Klarbach said. She also examined the effect of voluntary targets for gender diversity on supervisory boards at federal companies and public reporting on compliance with them. This combination of targets and transparency about compliance, as was the case with federal companies, also proved effective: the pressure created by the concrete targets and public visibility led to the nomination of more women, the researcher explains.

Little awareness of diversity as a success factor
As the study shows, voluntary self-regulation without additional pressure does not work in Austria. According to the study author, this indicates that gender diversity is not seen as an advantage and gender homogeneity is not seen as a disadvantage. This is despite the fact that numerous studies show that diversity can be a key success factor. "So for 'soft' measures to have an impact, there needs to be more pressure," Mensi-Klarbach said. Her study results make it clear that in Austria an increase in women could be achieved via concrete target figures and transparent monitoring of target achievement, but also through the credible threat of a legal quota. "Because 'hard' quotas cause resistance and attempts to circumvent them, and ultimately can hardly bring about a sustainable cultural change on their own, effective 'soft' measures are therefore a sensible alternative."

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Further information:

Mensi-Klarbach, H., Risberg, A. (eds.) (2019) Diversity in Organizations. Concepts and Practices. 2nd Edition. Plagrave Macmillan.
Seierstad, C., Gabaldon, P, Mensi-Klarbach, H. (eds.) (2017) Gender Diversity in the Boardroom: European Perspectives on Increasing Female Participation. Vol 1. The use of different quota regulations. Palgrave Macmillan.
Seierstad, C., Gabaldon, P, Mensi-Klarbach, H. (eds.) (2017) Gender Diversity in the Boardroom: European Perspectives on Increasing Female Participation. Vol 2. Multiple Approaches Beyond Quotas. Palgrave Macmillan.
Mensi-Klarbach, H., Vedder G. (eds) (2017) Geflüchtete Menschen auf dem Weg in den deutschen Arbeitsmarkt. Augsburg, Munich: Rainer Hampp Verlag.