Swiss Boards are finally becoming international – German boards aren’t

What do the management boards of the largest Swiss corporations look like – with regard to internationality and gender? Since 2006, this question is answered by the annual Schilling Report which evaluates the composition of executive boards and so-called administrative boards (supervisory boards) of the country’s blue chip firms and other large organisations. A similar study was carried out for Germany in collaboration with European Diversity Research & Consulting.
The trend for the largest Swiss companies is clear: While the percentage of women on boards only increased by 2 percentage points – from 4% in 2006 to 6% in 2013. The percentage of international board members rose dramatically over the same period of time – from 35% in 2006, the percentage increased to 45% in 2013; however, the figure had stagnated from 2006 to 2011.
The study included 119 organisations with the largest numbers of employees, employing an overall number of 860 board members and 820 administrative board members (from 89 of those companies). The 20 Blue Chip enterprises of SMI (Swiss Market Index) were evaluated as a separate group. This elite group of firms employs 68% international executives among their board members, which is significantly higher the average of the entire sample (45%). And looking at the SMI CEOs, the figure is even higher: three out of four CEOs have an international background (70% in 2012). In the overall sample, the share of international CEOs is 42%, and hence much lower than in the SMI and still slightly lower than the average internationality of the boards. However, all those ‘are quite high numbers,’ adds diversity expert Michael Stuber who has regularly commented on board assignments at large multinational firms.
There are also two groups at each end of the continuum: In 15 of the reviewed companies (13% of the sample), there are no Swiss managers working on the boards, whereas the boards of 19 out of the 119 reviewed firms (16%) have exclusively hired Swiss top managers.
On the supervisory / administrative boards, the percentage of international members is 36%, and thus slightly below the percentage of members on the executive boards (45%). In comparison to the previous year, the number rose by two percentage points.
Among the presidents of the administrative boards, there is a portion of 24% which have an international background – this number is much lower than the corresponding figure for CEOs (42%). For the SMI companies, the percentage of international administrative board presidents is 60%, which is again lower than the international share of SMI CEOs (75%).
But all those numbers are stunning when compared with the proportion of women among the administrative board members, which is at 12% and among the administrative board presidents at shameful 1%. The findings mirror the increasingly global business of the organisations, especially in the SMI, where all the firms are multinational enterprises. In the light of globalisation, demographic changes and tapping of new markets, the increasing diversity on boards seems to be a consistent trend and a result of a strategic talent development. Only at second glance it becomes apparent that there is an underrepresentation of strategically important nationalities, e.g. from emerging economies such as Russia or countries in Asia. Both, on SMI management and supervisory boards, more than half of the international members have an Anglo-Saxon background. Whereas in the management committee of the 119 organizations, Germans form the biggest group of internationals with a percentage of 40 points.
Ironically, Swiss firms are well ahead their German competitors of the DAX30 in terms of internationality. In German blue chip corporations, more than 70% of the board members are from Germany, followed by the US nationals (7%) and Austrians (4%). The latter is an indicator for a strong preference for close neighbours, speaking the same language. Maybe this is a positive sign for women who also often speak the same language – well, more or less.