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WOMEN

Top firms unveil plan to increase female execs

The 30 leading German companies belonging to the blue-chip stock DAX stock index unveiled a plan Monday to bring more women into management, but stopped short of making quotas compulsory.

Top firms unveil plan to increase female execs
photo:DPA

Currently, just 3.2 percent of the most prestigious positions at Germany’s 200 biggest companies are held by women, according to the German Institute for Economic Research.

Launching the initiative which they called “unique in Europe,” the companies said they would fix realistic objectives, specific to each company and would assess their progress annually.

They also emphasised the voluntary nature of the plan.”For these companies, voluntary participation is the sustainable and justified route, which renders a fixed rule via legislation superfluous,” the companies said in a written statement.

Although big-hitters in the German economy undertook efforts to increase female representation 10 years ago, little has changed.

Figures put forward Monday by the 30 DAX companies were more favourable, as they took into account all executive posts and not just the very highest levels of management.

They showed that the proportion of women in leading positions currently is 28 percent at Adidas, eight percent at steelmaker ThyssenKrupp and 28.7 percent at Henkel, producer of household products and cosmetics.

Automobile maker Volkswagen, the only company to distinguish three hierarchical management levels, acknowledged it had just 3.7 percent of women in its most prestigious posts.

But, in future, the aim will be to have 20 percent of women in management positions by 2020 at Daimler carmakers, compared to 11.9 percent today, or 14 percent by the end of 2014 at energy giant EON compared to its current level of 12 percent.

The German government, headed by Chancellor Angela Merkel, named the world’s most powerful woman by Forbes magazine, is split over the introduction of compulsory quotas for women in the boardroom.

While Labour Minister Ursula von der Leyen supports the idea, Family Minister Kristina Schröder rejects it, as does Merkel.

Von der Leyen accused companies of not comparing apples and oranges in their defining of management positions.

“I am waiting for clear responses concerning women on the board of directors and supervisory boards, where the money and power are,” she told a news conference.

In Germany, the board of directors consists of a company’s executive officials, while the supervisory board is made up of shareholders’ and employees’ representatives.

“I reject the principle of a mandatory quota,” Schröder said. A single quota would penalise heavy industry in particular, which is dominated by men at all hierarchical levels.

Regine Stachelhaus, director of personnel at EON, and one of the rare women in the board room of a DAX company said: “A mandatory quota is superfluous.”

However, she added this depended on strong government support for child care and the promotion of sciences being taught from primary school.

A survey of female executives and employees published Monday by polling institute Forsa; showed 55 percent were in favour of compulsory quotas.

AFP/DDP/The Local/jcw

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ECONOMY

German consumer prices set to rise steeply amid war in Ukraine

Russia's war in Ukraine is slowing down the economy and accelerating inflation in Germany, the Ifo Institute has claimed.

German consumer prices set to rise steeply amid war in Ukraine

According to the Munich-based economics institute, inflation is expected to rise from 5.1 to 6.1 percent in March. This would be the steepest rise in consumer prices since 1982.

Over the past few months, consumers in Germany have already had to battle with huge hikes in energy costs, fuel prices and increases in the price of other everyday commodities.

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With Russia and Ukraine representing major suppliers of wheat and grain, further price rises in the food market are also expected, putting an additional strain on tight incomes. 

At the same time, the ongoing conflict is set to put a dampener on the country’s annual growth forecasts. 

“We only expect growth of between 2.2 and 3.1 percent this year,” Ifo’s head of economic research Timo Wollmershäuser said on Wednesday. 

Due to the increase in the cost of living, consumers in Germany could lose around €6 billion in purchasing power by the end of March alone.

With public life in Germany returning to normal and manufacturers’ order books filling up, a significant rebound in the economy was expected this year. 

But the war “is dampening the economy through significantly higher commodity prices, sanctions, increasing supply bottlenecks for raw materials and intermediate products as well as increased economic uncertainty”, Wollmershäuser said.

Because of the current uncertainly, the Ifo Institute calculated two separate forecasts for the upcoming year.

In the optimistic scenario, the price of oil falls gradually from the current €101 per barrel to €82 by the end of the year, and the price of natural gas falls in parallel.

In the pessimistic scenario, the oil price rises to €140 per barrel by May and only then falls to €122 by the end of the year.

Energy costs have a particularly strong impact on private consumer spending.

They could rise between 3.7 and 5 percent, depending on the developments in Ukraine, sanctions on Russia and the German government’s ability to source its energy. 

On Wednesday, German media reported that the government was in the process of thrashing out an additional set of measures designed to support consumers with their rising energy costs.

The hotly debated measures are expected to be finalised on Wednesday evening and could include increased subsidies, a mobility allowance, a fuel rebate and a child bonus for families. 

READ ALSO: KEY POINTS: Germany’s proposals for future energy price relief

In one piece of positive news, the number of unemployed people in Germany should fall to below 2.3 million, according to the Ifo Institute.

However, short-time work, known as Kurzarbeit in German, is likely to increase significantly in the pessimistic scenario.

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