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Business

Top German Corporate Posts Still Off Limits to Foreigners

Germany’s Deutsche Bank and RWE may be headed by non-Germans, but that doesn’t point towards a trend. Rather, foreign managers still make up just about 10 percent of the German corporate landscape.

In recent years, Germany has been offering an increasing number of international courses at elite business schools to attract young potential managers and business leaders from all over the world. But the presumption seems to be that these go-getters will return to their native countries to begin their climb up the corporate ladder.

For when it comes to German companies, international candidates can only work their way up so far before coming up against a solid door that leads to the managerial level. These posts, it seems, are meant for Germans.

Germans still preferred for top jobs

"The majority of managers are clearly recruited from their own national pool", Professor Michael Hartmann told DW-WORLD in an interview. The professor of sociology at the University of Darmstadt has been researching business and industry elite and personnel policies of international top managers for years.

Hartmann finds that most German companies give first preference to young German candidates. "National careers are absolutely dominant".

He says that an international comparison shows that even France, Japan and the U.S. are not that different from Germany: all hire a relatively small percentage of foreign managers in their corporate firms.

Ackermann and Roels still the exceptions

A high-profile exception to the German model is Josef Ackermann, the Swiss boss of Deutsche Bank, who took over in May this year and caused a stir in the corporate world with his plans to radically overhaul the traditional management structure at one of Europe’s biggest banks.

Another is Dutchman and energy expert Harry Roels, who will take over German energy giant RWE in February next year.

Hartmann finds that the hype surrounding the two non-German corporate heavyweights is simply exaggerated by the media. For despite globalisation and a worldwide opening of markets, foreigners comprise just about 10 percent of the jobs on the management boards of the 30 DAX companies.

"If one takes away the Alps fraction, then that leaves just about 7 percent", estimates Hartmann. Austrians and Swiss are preferred when it comes to hiring the few non-German managers in the country, he added.

Israelis such as Uriel J. Sharef at Siemens and Irishman John P. Phelan at the insurance company Münchner Rück are rare exceptions.

Globalisation hardly nudging personnel policies

Hartmann sees neither a major personnel policy shaped by global forces nor a comprehensive international world of managers taking form in the near future.

"The appointment of Ackermann and Roels, merely consolidates the status of the 1990s. At that time there were two foreigners – Guiseppe Vita at Schering and Ferdinand Piech at Volkswagen – filling top posts at German firms. Now once again there are two of them".

Hartmann believes that "truly international companies" only exist in small countries such as Switzerland and only on account of the limited leadership potential in the countries.

In the long-term, a common European economic playing ground would change that. But until then, Hartmann foresees a tough process, "at the moment there are clearly national traditions everywhere".