Deutsche Welle (English edition)
Diversity: The road to success
Diversity is a good thing and necessary for companies. Several studies on the subject show that diversity is a prerequisite for larger economic success, but it can also trigger new conflicts.
It's not a new revelation that diversity is good for companies. "Germany is a diverse country, and a big deal of its productivity is based on this diversity," German Chancellor Angela Merkel said in a recent statement. "We need to view diversity as an opportunity to harness its potential."
And the potential seems to be big. Companies with high gender diversity stand a 25% higher chance of securing aboveaverage profits, according to a 2020 study by the consultancy McKinsey.
When the boardroom also shows ethnic diversity, that percentage climbs to 36%. The study was based on data from over 1,000 companies in 15 nations.
Considering demographic developments, companies are bound to put an ever-greater emphasis on diversity. Germany's population is expected to shrink to 65 million by 2060, despite forecasts of some 100,000 to be added yearly through migration. In 25 years from now, roughly one-third of the population will be 65 years or older, Germany's Federal Statistics Office predicts.
But changes in society have been slow in coming. Some three years ago, the Swedish-German AllBright Foundation looked into the composition of boardrooms in the 30 largest listed German companies. It found that back in March 2017 executive boards were 93% made up of men, with 5% of the CEOs having Thomas as their first name. There were in fact more Thomases and Michaels among the board members (49) than women (46).
And this despite the fact that German companies voluntarily agreed as early as 2001 to seek a higher percentage of women in leadership positions.
So, what's the state of affairs today? Right now, only under 12% of all 681 board members of all DAX-, MDax- and SDaxlisted companies are female, according to the consultancy EY. If everything goes according to plan, then the first woman to head a DAX company on her own will start work in early May.
The Diversity Charter is a German corporate initiative to promote diversity in companies and institutions. Its chair, AnaChristina Grohnert, told DW she doesn't accept the argument that there are simply not enough women around to qualify for leading positions.The debate is not just about gender equality. It's also about preventing
Businesses increasingly understand that diversity has to be actively supported. Some 3,800 organizations with a total of about 14 million employees have already signed the Diversity Charter as a self-commitment. Among them are 25 of the 30 DAX-listed enterprises, but also smaller companies and authorities. The charter was called into being in 2006 by four companies. The nonprofit association by the same name has been around since 2010.
On paper, this looks like widespread support for the cause, but in 2020, two-thirds of all companies in Germany still failed to implement diversity management measures. A study by the Diversity Charter adds that only 19% are planning concrete steps in the near future.
More diversity can also trigger conflicts, according to sociologist Aladin El-Mafaalani, a professor at Osnabrück University. He says society in Germany used to be like a table at which some old white men called the shots. Increasingly, there are now people at the same table who have disabilities, who're not heterosexual, who are female or who have a migrant and nonChristian background.
All these groups now want a slice of the cake and question traditional table manners. "People at the table who are fully integrated want to have an equal say in all matters," El-Mafaalani wrote in an article for Germany's Federal Agency for Civic Education. He concluded that multiple inputs could lead to multiple outputs, but also cause conflicts. He warned against viewing such conflicts as something completely negative, though.
"Diversity doesn't create harmony but requires energy," confirms McKinsey's Julia Sperling. "It's far easier to arrive at decisions in a homogeneous group of people where everyone's of the same opinion anyway," she argues. "But our study is proof that seeking more diversity is an effort worth taking."
the sense that the poor mental health leads to a lack of economic performance, or at least the economy not reaching its potential."
In 2018, Goetz and his co-authors wrote a study predicting the global economic cost of mental illness is expected to be more than $16 trillion over the next 20 years.
But the scale of the coronavirus crisis that would hit just two years later means that forecast is now on the low side.
"I don't want to say 'orders of magnitude,' but a doubling, tripling, quadrupling of that effect wouldn't surprise me just because of the repercussions of the decline rate and all the effects on mental health," Goetz said.
His study highlighted the importance of public investment in mental health services as one way to contribute towards staving off even worse economic pain later. Public campaigns for mental health awareness in the crisis would be critical.
There need to be more resources, more awareness into this and the connection, especially understanding this connection between the pandemic and everything it causes beyond physical health, Goetz said.
Where does that leave a country like the Philippines? Over half a million cases of the coronavirus make the Southeast Asian nation one of the worst-hit regions. It had one of the strictest and longest lockdowns globally, causing the economy to shrink 9.5% in 2020 — the worst decline in Asia. An estimated 4.5 million Filipinos are set to slide back into poverty.
And the global mental health crisis accompanying the economic crisis has found fertile ground here too. Before the pandemic, mental health illness was already the third most common disability. An estimated 6 million Filipinos live with depression and/or anxiety — a number that is likely much higher as the multifronted crisis persists.
For many, existing financial struggles means that accessing mental health services fall low on the priority list.
A one-hour session with a private clinical psychologist for counseling and psychotherapy can cost anywhere from 1,000 to 3,000 Philippine pesos (€16 to €50) in Manila. With monthly wages averaging around €230, paid professional help is out of reach for most.
"It is very difficult to find mental health practitioners who provide pro bono or highly socialized fees," said Lyra Versoza, an independent consultant for mental health and psychosocial services in the Philippines.
And there aren't even that many professionals able to provide help to begin with, she told DW. Psychiatrists and psychologists are too few — with the scarcity becoming more pronounced, the further away from urban areas a potential patient lives.
"In the Philippines, we have around 600 psychiatrists for a population of 110 million and most are situated in Manila," Versoza said.
Although the Mental Health Act, which seeks to provide affordable and accessible mental health services for Filipinos, was signed into law in 2018, much remains to be done in practice. Only about 3 to 5% of the total Philippine health budget is spent on mental health.
Versoza described existing challenges to obtaining help.
"We have a governmentfunded crisis hotline. I dialed this number for an entire hour without success," she said. "And people ask, what is the point of seeking professional help if you won't be able to afford medication?"
But at a time like this, when money is a key determinant of whether one gets access to psychological help, then providing free, public mental health services may be a game-changer.
Versoza travels to provide free training and direct mental health services to communities around the country as part of efforts funded by civil society and other groups stepping in to help fill the gap.
"There is a way to make mental health services and medicine affordable through proper community organizing and coordination with local, nongovernment units, private civil society groups, as well as local or international donors," said Versoza. But she added resources remained scarce.
And that leaves many like Dalmacio to deal with their mental health privately.
"I wish that there were a reset button. I wish there was something I could do to rejuvenate my brain. I've been trying not to think about it," said Dalmacio.
At the moment, most will have little choice but to soldier on. But investing in mental health is investing in any economy's most important resource — its people. All countries, not just the Philippines, should make it a priority.