Siemens is just too German, says CEO

Conglomerate Siemens is too male, too white and too German - and that's according to its own CEO...

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Last Updated: 06 Nov 2012

Peter Loescher, the Austrian brought in to run Siemens last year in the wake of a corruption scandal, reckons that the group is not fulfilling its international potential because its management team is not diverse enough. ‘Our top 600 managers are predominantly white German males,’ he told the FT Deutschland. ‘We are too one-dimensional.’ Rumour has it Loescher was first alerted to the problem when he wandered into a board meeting early to find that all his top managers had reserved their places with towels at 6am.

Loescher wants Siemens’s management to better reflect the company’s international customer base, which accounts for about 80% of the group’s turnover. Although three of the eight people on the management board are actually non-German (Loescher himself and two Americans), he wants the likes of China and India – two huge markets for Siemens – to be represented at the top table. ‘I would like to see a much more diverse board; I would like to see a big Chinese running China and a big Indian running India,’ he told the FT (hopefully this is an idiosyncratic translation, rather than a sizeist recruitment policy).

To be fair to Siemens, it’s not exactly the only company in Germany with this problem. Diversity remains a significant issue in the country, with hardly any women in senior executive positions (ironically, given that it’s one of the few countries with a female political leader) and relatively little international business talent going there to work. Ironically, the German-ness of German companies used to be seen by international rivals as a source of great strength a couple of decades ago - these days it appears to be considered a competitive disadvantage.

And fortunately for Loescher, he’s got a pretty strong mandate for change. Siemens, which makes everything from light bulbs to mobile phones to sewage works, has had its reputation dragged through the mud in recent years, after news emerged that senior officials had been bribing their way to lucrative contracts across the globe. It’s since identified over £1bn in slush funds (used for backhanders), and has spent further billions cleaning up its act – these days its executives have compliance training coming out of their eyeballs. As the man brought in to clean up this mess last year, Loescher shouldn’t lack support for his reforms.

In the meantime, perhaps he should look on the bright side: at least this way his company should have a great chance of winning corporate football tournaments...

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