“Quotas Enhance Sustainability of Companies”

By incorporating women and men from diverse backgrounds, experiences, and perspectives, companies can leverage a broader spectrum of ideas and solutions. Moreover, a diverse workforce contributes to creating a welcoming work environment. Eline Schoonjans, a researcher in the “Economics of Innovation and Industrial Dynamics” Unit at ZEW Mannheim, explains:

“Countries around the world are striving to achieve gender equality. Some have implemented political measures such as gender quotas in supervisory boards and executive boards to increase the representation of women in decision-making positions.

Evidence shows that companies with gender quotas and more women in leadership positions also implement more environmental and social initiatives. These initiatives include improved innovation, resource utilisation, and a stronger focus on human rights. Interestingly, firms already facing higher public expectations for sustainability show smaller gains from the gender quota.

In addition to changing leadership dynamics, gender diversity in supervisory and executive boards acts as a catalyst for further improvements in achieving sustainability goals. Therefore, policymakers and business practitioners are well advised to consider the interactions between different dimensions of sustainability in their decisions.”