The New New Boss - Annika Falkengren

(Article first published in Currents 2 2005).

“I never felt that anybody looked at me differently because I was a woman. What made the difference was that I got the opportunity to work in line management where you can show results,” says Annika Falkengren, deputy CEO and soon full CEO of one of Sweden’s largest banks, the SEB.

Annika Falkengren was recently named the most powerful businesswoman in Sweden, but female bosses are a rare species in the private business sector of welfare Sweden. Women are found in many management jobs in the public sector, they have captured close to half of the seats in the parliament (45 percent), and eleven of twenty-two posts in the cabinet. Although 90 percent of Sweden’s women work, the private sector has been embarrassingly slow in letting women join the ranks of management, and even more so when you reach the top. Only two percent of the CEO’s of publicly traded companies are women, and although the number of female board members took a dramatic jump after vice-premier Margareta Winberg in November 2002 threatened with quotas, women are still few and far between in most boardrooms. This in a country that has been run by social democrats for most of the past three quarters of a century, not counting a couple of short-lived non-socialist interludes.

Annika was of course not selected as a CEO because she was a woman, something Jacob Wallenberg, the chairman of the board, made explicitly clear as he introduced the result of a yearlong executive search done by headhunters. She got the job for the same reason that Samuel Palmisano became the new CEO of IBM when Louis Gerstner retired. She had been a line manager in charge of SEB:s largest business area – Corporate & Institutions - that had produced the right numbers year after year, adding value to the bottom line. There may have been many good soft reasons to pick a female CEO in a company where 60 percent of the employees are women, but this decision was about competence and performance.

The symbolic significance of this decision may however not lie so much in today’s outcome, but in the fact that she might very well have been overlooked a generation ago.

“I am proud over the fact that the bank, for the first time in 50 years, picked the new CEO from inside. The SEB and the Wallenberg family is sometimes seen as rather conservative, so it is nice to be able to show that we as always are professional and modern in our thinking. We preserve the heritage, but view the world with modern eyes,” she says.

But change is coming and it is reaching the boardrooms as well: Half of the eight members of FSB’s board are now women, five of fourteen board members at Svenska Handelsbanken (SHB) are women, as are four out of twelve at Nordea. In this area however, SEB is a laggard: When Annika joins the board next year; only three out of twelve members will be women.

Annika has worked in the bank for almost half of her life (she is 43), and claims that she never experienced any glass ceiling or glass walls. “I work in the financial sector, which I think is an excellent sector to be in, as it is results-oriented. I’ve also had very good managers. My first manager, Mats Larsson, followed my career for ten years, and he meant a lot to me. I turned down a couple of job offers in the beginning, not feeling quite confident about my ability, but he pushed me ahead. There was no corporate policy to promote women; it was just that my manager felt that I was suitable, even when I couldn’t see it myself. I think that women tend to hesitate more before taking on a new task. We want to be so sure, while men just throw themselves into the game saying ‘I’ll take care of that!’ I was lucky in having a manager that believed in me, and then I started to work for CEO Lars Thunell, which also worked out well.” (He is 58 and will retire when Annika takes over the reins.)

“I never felt that anybody looked at me differently because I was a woman. What made the difference was that I got the opportunity to work in line management where you can show results. I felt safety in knowing that I had delivered ‘kronor’ and ‘ören’ (i.e. dollars and cents) to the bottom line and had happy customers. It shows,” she continues.

She may not have faced a corporate glass ceiling herself, but she is fully aware of the wider impact of her appointment. She wants to encourage other women to become managers, which is why she has addressed the Swedish-American Executive Women’s conferences founded by Renee Lundholm, president of SACC New York, and speaks at universities and business schools.

For Annika herself, this has been only one of the large changes to her life over the last few years. She married Ulf Falkengren and gave birth to a daughter about a year ago. Now she had the option of enjoying 480 days of paid parental leave - the standard in Sweden - but she was soon back at work. “I married the right man. I was on maternity leave for three months, and now he stays home taking care of our daughter until she is ready for day-care. So far that solution has worked well for us. I am also privileged in that I can afford to buy the services we need to make our everyday life manageable,” she says.

When asked about managerial role models, she says that she has many, but can’t single out one particular. She is grateful to her managers at the bank, and admires Jack Welch for his focus on human resources and quality. In the background there is also her mother, who was working outside the house until her father, a diplomat, was stationed in Thailand. “I had a very strong father figure who believed that anything I did was fabulous,” she laughs.

Her road to the top was never mapped out at an early stage. “There are those who come out strong, pushing with all their might, but things don’t always happen according to your plan. You must be ready to seize the moment. My first boss left the bank when he was 51 and wanted me to take over. I was only 37 then. It was pure luck. If he had stayed on for ten more years, I may have been doing something else. And then we have the fact that Lars Thunell retires relatively early… Don’t expect the road to be completely laid out. Find a job that you feel passionate about rather than skit around from base to base.” For her it was also important that she worked in a wholesale division, and she advices women to pursue jobs as line managers, which is unusual as many women choose to work in HR, marketing or communication. “There are few women as line managers, but that is where CEO’s are usually picked, not from the staff at the headquarters.

“One woman cannot change society. There needs to be more of us for it to be possible to say that Sweden has truly embraced the concept of women as leaders in the corporate world. SEB is pro-actively aiming at increasing the number of senior managers. For us it is a question of profitability. We cannot afford to miss out on 50 percent of the most talented people,” Annika Falkengren concludes.

Hans Sandberg

Beyond the Superwoman...

(Article first published in Currents No. 2 2005)


You’ve heard it before: In Sweden, almost all adult women work and new parents get 480 days of paid parental leave, plus subsidies from the government. In America, soccer moms, with Ph.D.’s but no career, shuttle their children between after school-programs, while childless yuppies race for the top. Stereotypes about Sweden and America are not hard to come by, but the messy reality of contemporary life and work is harder to grasp.

“There are so many paradoxes,” says Lillemor Westergren, associate professor at the School of Business at Stockholm University. She and many other Swedish researchers are critical of Sweden’s achivements when it comes to gender equality in the private business sector. “Our massmedia are still making a big deal about the appointment of a female CEO,” she says, but adds that “the appointment of Annika Falkengren as CEO in a such conservative sector as banking, and in particular of SEB, could indicate that something big is happening in Sweden.” But on the other hand, she warns that it may be premature to talk about a new trend. Only a handful of women have reached the pinnacles of power in the private sector, and very few women have taken place in the overwhelmingly male boards of publicly traded companies.

It is true both in Sweden and in the U.S. that there are very few women at the very top of the business world, but over half of all managers in the U.S. are women, and women run many large companies. Here the numbers are not all that flattering for Sweden. Female managers at mid- to higher level in the private sector grew from 9 percent in 1990 to 26 percent in 2002, and 31 percent in 2004. In publicly traded companies, the proportion reached 31 percent in 2002, and 34.5 percent in may of 2004 (according to Micromediabanken’s 2004 survey.) In the Swedish banking sector, the percentage of female managers rose from 10 percent in 1990 to 28 percent in 2004.

“There was a large jump in the number of women board members in private industry,” says Anne D. Boschini, a research associate at the Department of Economics at Stockholm University, and author of a gender study for the Center for Business and Policy Studies (SNS). The jump occurred in 2003 in response to a government threat of legal action in order increase the number of women board members. This had been done already in Norway, where companies above a certain size must have at least 40 percent female board members. In Sweden, only ten percent of board members are women, and 42 percent of all corporate boards are exclusively male. The social democratic government is not happy with this state of affairs and still talks about quotas.

Sweden is about ten years behind the U.S., when it comes to women and management, according to Boschini. She adds that one of the more surprising results of recent research is that while the corporate glass ceiling has been shattered in the U.S., it remains in place in Sweden. And it is getting worse. “The differences in pay between men and women are increasing as you reach higher pay scales, which is not the case in the U.S.,” she says.

One possible explanation could be that the Swedish model is based on what Marianne Sundström, associate professor at Swedish Institute for Social Research (SOFI) calls a ”working class” perspective. ”Women are expected to work, but not really to have a career,” she says. The pay after tax – even for a mid-level manager – doesn’t allow her to hire help to deal with the household work, or a private nanny, which might be a necessity if you have to take an afternoon flight to Berlin or New York, and your husband is also working fulltime. Even if you have the money, the private service sector is very limited, and besides, many Swedes frown upon such ”private” solutions. In the U.S. the service sector is much more developed, from take-out food to gardening and housecleaning.

”I remember how few women there used to be at the platform at the train station in Greenwhich back in 1983. Today there must be 30-40 percent women,” says Renee Lundblom, a veteran of SACC New York, and its first female president. She runs the largest and oldest of SACC-USA’s 19 member chambers, and is also the founder of the Executive Women’s Conference, which alternates between Sweden and the U.S. ”We want to build bridges between Swedish and American female executives,” she says and adds that networking is often hard for women, as they do more of the housework and have less time and energy for mingling. But networking is important, and the conference is one way to help women share their experiences and get ahead.

There have been large changes in both Sweden and the U.S. over the past 30-40 years. In the U.S. the civil rights movement and its aftermath led to a much tougher stand against discrimination, which over time made it risky for companies not only to engage in discrimination, but to ignore it. The threat of class action lawsuits made it a necessity to be proactive and institute policies that insulate a company from accusations of discrimination, and unequal treatment of women and minorities.

Sweden relied instead on a combination of legal and social reform to encourage women to work, and to promote gender equality at work and in society at large. The 1980 ”Act on Equality Between Men and Women in the Workplace” created an Ombudsman for Gender Equality (Jämställdhetsombudsman) to monitor and punish discrimination. This act, which in 1992 was replaced by the ”Equal Opportunity Act” demands of employers that they actively promote equality in the workplace. There is also a government Council on Equality Issues, which is led by the Minister for Gender Equality Affairs. Women have had the right to vote since 1921. 45 percent of the 349 members of the parliament are women, and eleven of twenty-two members of Göran Persson’s cabinet are women.

However, in the private business sector, change has been slow. And it seems that - one of many paradoxes in this field - the very same system that was built to support parents and women in particular, is holding back those women who want to pursue a career in the corporate world. The Swedish model is generous for working parents, as long as they stick to the model, which prefers uniform solutions. In addition, the egalitarian wage structure, plus the high and progressive income taxation makes it hard to afford help. “Pushing ahead in a career could mean that you have to work 60 hours a week, but it is expensive to pay your way out of household work in Sweden,” Marianne Sundström says. And even if Swedish men are picking up more of the household work these days, most of it still falls on the women, working or not.
Besides, a corporate executive may be less interested in parental leave, than having a nanny for their kids. “In Sweden, you are supposed to do everything yourself, taking care of the children, the household, the summer cottage. And as you are not supposed to hire help, it is very hard to strike a balance between work and life,” says Renee Lundholm.

Viveca Wahlstedt, who is manager for the consulting and executive search firm Carnegie Worldwide in Orlando, Florida, faced this negative attidude to hiring domestic help when she had applied for adoption back in the 1980’s before she moved to the U.S. The caseworker wrote in her case file that she intended to use a nanny, which was clearly a negative signal. (What kind of mother would do that?)

“I never took parental leave,” says Wahlstedt, whose father was an entrepreneur and had that “can do” attitude that led her to view things as possible rather than its opposite. “My first job was at a chemical company that faced an upsurge in international orders. They faced a crisis, because they couldn’t recruit more men and those they had already worked overtime. Why don’t hire women? There are many female chemist right out of school that can’t find jobs,” she suggested. It was an outrageous thought back then, but it worked and she made her way into management, and eventually to the U.S. “You need to build up your inner strength, so that you feel secure and don’t hesitate to try out things, or blame others for not achieving your goals,” says Wahlstedt, who is also a member of SACC-USA’s board.

Anna Stern worked in Sweden’s design world 1996-1998, and in the U.S. from 1999 to August of 2001. She says that men dominate the design business in the U.S., but that you can move ahead fast if you are willing to take responsibility and solve problems. And your pay moves too. Stern doubled her salary in two years time, but decided in the end to return to Sweden for sake of the lifestyle. She is a studio manager at the design firm Propeller, which was recently acquired by the larger firm Semcon. “Sweden has good design schools, and people are very open and creative,” she says.

Barbro Ehnbom came to the U.S. some 30 years ago on a scholarship fresh out of Sweden’s leading business school, the Stockholm School of Business (Svenska Handelshögskolan). She has worked in the pharmaceutical sector, in mergers and acquisitions, and runs her own investment advisory company, the DuHahn Group. She is also a longtime board member of SACC New York.

Her own experience – she was often the only woman around – has made her skeptical when it comes to women’s career chances whether it is in the U.S. or Sweden. This is why she has spent a considerable energy in building networks for young women entering the business world. Last year she launched a new scholarship for students at Svenska Handelshögskolan called “Female Economist of the Year.” She wants to put a spotlight on bright young women. It is not only about money and an internship, but access to a network of hundreds of experienced managers that stand ready to help and give advice. “You get a lead into the old boys network,” she says.

“But the real challenge is not right in the beginning of women’s career, which usually goes well until you are 37,38, 39. That’s when women tend to fall behind, because now you are suddenly a mother and have to deal with your husband’s ambition. At that point, it is not cute anymore to be successful. Your ambition is suddenly seen as a threat,” she says.

“It’s not enough for women to take the same role that men have had, and to find men who can run the household. All we’ve then done is to swap roles. The most important thing is to have those who put together the criteria for a board or the job description, to write them so that they can fit a woman. If you don’t do that, it will always be easy to say that there was no qualified woman available. Guess what, the criteria was written by three likeminded guys in their fifties,” she says.

Like many other female experts managers Currents spoke to, Ehnbom feels that the U.S. is ahead. “America is such an enormously diversified country. Of course, there are industries dominated by one type, i.e. white men. It was like that when I started out in the pharmaceutical industry, but other ways you do have a highly diversified nation, and that is true not only for women, but for blacks and Puerto Ricans and so on. If you have a good idea, you can make it here. You are not held back like in a more homogenous country like Sweden, where a few clans have been so dominant in the business world.”

“Many American companies understand the importance of diversity. This is true not only when it comes to gender discrimination, but also for ethnic discrimination. It is easier to be different in the U.S.,” says Agneta Rosenberg, who would have been the first female systems engineer in Sweden if she had taken an offer from IBM back in the 1980’s. She decided instead to take an offer from IBM in the U.S., and worked many years for them before starting her own consulting company Interim Ventures, which help Swedish companies to enter the U.S. market.

“It is easier to be a woman and a manager in the U.S. It is true that you have parental leave in Sweden and you get to keep you job even if you stay home with your children, but is it the same job that you return to? Many salespeople work with specific accounts, and maybe the client will prefer the person who took over while you were out. There is also the risk that you are loosing touch while you are home with the children. Other people may bypass you,” says Katarina G. Bonde, who has worked as a manager, venture capitalist and consultant in the IT-business for over twenty years. She is CEO of Kubi Corporation and a member of SACC-USA’s board.

Some American companies are trying to make it easier for women to combine parenthood with career, Bonde says while adding that many American women managers abstain from having children – yet another paradox. “It is hard to combine the two,” she says. Competition is so hard and many companies have a rigid attitude to parents need to stay home when a child is sick.

This dark side of the paradox was underscored in the March issue of Harvard Business Review. Too many women managers choose to “opt-out” from the career track according to its authors, Sylvia Ann Hewlett, director of the Gender and Public Policy Program at Columbia University, and Carolyn Buck Luce, a senior leader in the Global Accounts Group at Ernst & Young.

“Women want to work, and corporations must find alternative pathways to power. Our study, based on a sample of nearly 2,500 highly qualified women, examines the realities of women’s challenges and choices, probes their ambition, and traces the course of their careers. Our research shows beyond question that highly qualified women want to work. Not only have they invested heavily in their education and careers, but their professions give shape and meaning to their lives. Of the women who have taken an “off-ramp” from work, a full 93 percent want to come back. And many do take off-ramps. Nearly 60 percent of the women we surveyed take time out from their careers (37 percent) or follow what we call a “scenic route.” They decline a promotion, transfer from line to staff roles, take a job with less responsibility or work part-time, all in order to be able to manage the other responsibilities in their lives from time to time, be they children (45 percent), elder care (24 percent) or other outside interests. Put another way, the majority of highly qualified women have non-linear careers,” Carolyn Buck Luce wrote in a column for the Los Angeles Business Journal on April 4.

It looks like we are back where we started. But maybe not… While many Swedish experts and career women seem to yearn for more of the American dynamism, individualism and meritocracy, many American experts and career women seem to yearn for some of Sweden’s flexibility when it comes to giving parents more security, flexible work hours and maybe even a chance to smell baby powder now and then.

Could there be a middle way between the Scylla of the Swedish welfare uniformity and Charybdis of the American rat race?

Hans Sandberg