Executive summary

Globalisation has brought many benefits to the Netherlands, including jobs, more affordable products and higher productivity. There are also countless advantages for firms that operate across borders: larger sales markets, knowledge and innovation. However, there are also signs that not everyone is benefiting equally from the advantages that internationalisation brings, and that globalisation is leading to shifts in the employment market and putting downward pressure on wages.

In its broadest sense, inclusivity – or inclusion – simply means that everyone can participate, regardless of the differences between people and groups of people. This depends on equal opportunities and acceptance. Inclusivity with respect to globalisation is an increasingly important priority. When applied to globalisation, inclusivity means ensuring that more people can benefit from the global exchange of goods, money, information and people. In this edition of the Internationalisation Monitor, we focus on Dutch international trade in the context of inclusivity. We analyse a number of aspects such as the male-female ratio among employees and directors, and inequality in import tariffs in order to provide a picture of the current state of inclusivity and its (potential) benefits.

Globalisation has helped the Netherlands to make a great deal of economic progress in recent decades, but it has also changed our country, bringing shifts in the labour market and new technologies. A lot of research on the benefits of globalisation takes place at the level of firms, but here we go a step further by looking at the people behind those firms. In this edition of the Internationalisation Monitor, we discuss inclusivity in the context of internationalisation: how inclusive are firms that operate across borders in terms of their employees and directors? What are the benefits of a diverse management team for firms, when it comes to internationalisation and sustainability? And are women as involved in goods and services exports as men? Are they remunerated equally in export-related jobs?

Inclusivity not only concerns diversity in the workforce of firms that operate internationally, but also the design of the systems that make globalisation possible. The tariff system is an important aspect of this, and this edition of the Monitor also examines whether import tariffs are applied equally to different types of firms in the Netherlands.

1Gender diversity among firm directors (board members) and the business performance of Dutch firms

• This chapter examines the relationship between the composition of Boards of Directors and the international activity of Dutch private and public limited firms with at least ten employees. Between 2012 and 2022, the share of female directors increased by 3 percentage points, reaching 18.1 percent. The absolute number of female directors increased by 40 percent over the same period, from over 17 thousand in 2012 to approximately 24 thousand in 2022.
• As firm size increases (in terms of the number of employees), the proportion of firms with only male directors decreases: from 70 percent for small firms (10 to 50 employees) to 59 percent for large firms with at least 250 employees.
• Firms that do not engage in international trade have a significantly higher average share of female directors. Between 2012 and 2021, in each year the average share of female directors was 1.5 percentage points higher than the average for all firms, and it was 2.8 percentage points higher than the average for firms that engaged in international trade.
• Multinationals that are based overseas also tend to have a higher proportion of female directors, but Dutch multinationals lag behind and have an even lower share of female directors than the other Dutch firms in the sample.
• Of the sectors within commercial services and manufacturing, food and accommodation services and the petroleum industry have a relatively high proportion of female directors. By contrast, other sectors, such as the furniture and metal products industries, have made much less progress in this regard.
• The results of the econometric analysis show that firms with a higher proportion of female directors are slightly less likely to start exporting or investing abroad, which is consistent with earlier findings from other countries. However, in cases where firms with one or more female directors become internationally active, they achieve significantly higher export values than firms with fewer female directors. This applies to both goods and services exports.

2Women in top management and sustainable business performance

• This chapter examines the relationship between women in top management teams (TMTs) and expected green investments and environmental costs, using descriptive and econometric analysis. The results show that companies with all-male TMTs have, on average, the highest spending on green measures per employee. However, this pattern is mainly driven by a small number of companies with very high spending on green measures, which skew the average upwards significantly. Companies with at least one-third women in their TMT report lower average environmental costs per employee.
• Regarding expected investment in sustainability, we see that companies with a diverse TMT, in which women make up at least 33 percent of the team, expect to invest more in environmentally friendly technologies and processes than companies with an all-male TMT. This supports the idea that diversity in TMTs can contribute to greater willingness to invest in sustainability.
• Further analysis of the data shows that companies with a diverse TMT have specific priorities when it comes to environmental costs and investment expectations. For instance, they spend more on saving energy and improving air quality, while companies with an all-male TMT spend more on renewable energy. In terms of green investment expectations, companies with at least one-third women in their TMT expect to spend more on every type of green investment than companies with an all-male TMT.
• Company size was also shown to be an important factor. In large companies, environmental costs per employee are higher for firms with a diverse TMT, but this effect is not observed in smaller companies (independent SMEs). This suggests that, in larger companies, a more diverse management team may be associated with more intensive investment in measures to help the environment.
• The multinational status of companies also plays a role. Among multinationals headquartered abroad, companies with at least one-third of women in the TMT have much higher spending on green measures per employee than those with an all-male TMT. This may indicate the influence of international norms and expectations on sustainability performance. Meanwhile, Dutch multinationals show a different pattern: they have lower environmental costs with a diverse TMT, but higher investment expectations. This suggests that diversity in management structures, particularly among foreign multinationals, is linked to a greater focus on investment in environmental sustainability and environmental costs.
• These findings are supported by econometric analyses, which suggest that a 1 percent increase in the share of women in the TMT results in a 0.336 percent increase in green investment expectations per employee. This would indicate that companies with a higher percentage of women in the TMT expect to invest more in green initiatives. These findings highlight the importance of promoting gender diversity in TMTs as a way to encourage investment in environmental sustainability. Our results also show that (1) a higher number of female employees in a company and (2) companies that actively adopt green technologies have a positive effect on the share of women in TMTs.

3Who contributes to the Dutch export economy? The gap between men and women in export-related employment and remuneration

• Trade can have implications for job and wage disparities between men and women, and potentially lead to new opportunities for women.
• In this chapter, we present new figures on export-related employment in the Netherlands, broken down by worker characteristics. We investigate the participation of men and women across various sectors and occupational groups, and also consider different types of employment relationships, levels of educational attainment and age categories.
• Export-related jobs include those who work directly for exporting firms and employment that is indirectly linked to exports, via upstream suppliers of exporting enterprises. Employment figures are expressed in terms of full-time equivalents.
• In 2022, 42.4 percent of jobs in the Netherlands were held by women, compared to 30.4 percent of export-related jobs. This implies a disparity between the sexes of 11.8 percentage points. This difference in the representation of men and women in export-related jobs narrowed between 2015 and 2022; in 2015, the gap was 12.2 percentage points.
• This pattern can be attributed to the fact that women are more likely to be employed in sectors that are less associated with exports. The sectors with the highest proportion of female workers, such as care and welfare (83 percent) and healthcare (75 percent), hardly engage in any exports. By contrast, sectors with the highest export dependency, such as water transport (78 percent), the electrical industry (78 percent) and the automotive industry (76 percent), have a share of female employment of no more than 25 percent.
• Export-related jobs can be broken down by type of export. While women were underrepresented in every export flow compared to men, the share of women employed in export-related activities was lowest in Dutch goods exports (27.4 percent) and highest in travel services exports (43.9 percent).
• Women mainly participate in export activities indirectly, working for firms in the services sector that provide inputs to exporting firms. Men dominate in technical occupations and are more likely to work for exporting firms directly, often in the manufacturing sector.
• In 2022, women received 24.9 percent of the total wages associated with export-related jobs (excluding self-employed individuals), while the corresponding share for export-related female jobs was 29.6 percent. On average, export-related jobs for women were no better paid than other employment opportunities for women across the economy as a whole.
• Women did receive a wage premium if employed directly by an exporting firm, however. Women working for suppliers of exporters earned less, on average, than women working for non-exporters, such as in healthcare.
• Subsequently, a structural decomposition analysis was carried out to analyse the specific factors that influenced changes in trade-related employment of men and women between 2015 and 2021.
• For men, the export of both goods and services were key drivers of employment growth, while for women the export of services in particular were the main driver.
• Changes in the labour intensity of production related to exports had a positive effect on female employment in several occupational groups, including ICT occupations (female employment more than doubled between 2015 and 2022), technical occupations (over 50 percent growth), management positions, transport and logistics occupations and other service occupations.
• By contrast, changes in labour intensity adversely impacted male employment related to exports across nearly all occupations, with the exception of ICT occupations.
• Women were more likely to have permanent contracts in non-export-related jobs and flexible contracts in export-related jobs. As a result, in export-related employment women had a higher share of jobs with a flexible employment relationship (37 percent) than jobs with a permanent employment relationship (28 percent). This can partly be explained by the fact that more men work in the manufacturing sector, where permanent contracts are more common. By contrast, women are more likely to work in export-oriented areas of the services sector, such as business services, trade, transport and hospitality, in which flexible contracts are more common.
• The higher the level of educational attainment, the larger the share of women in export-related jobs. In 2022, 36.4 percent of export-related jobs held by university/HBO graduates were held by women. Among MBO graduates, the share was lower at 28.7 percent, and it was even lower for people with at most primary or VMBO education (26.2 percent).
• The average person aged 55 or older in an export-related job is more likely to be employed in the manufacturing sector and directly by an exporting firm. By contrast, young people aged 15 to 34 hold a higher share of jobs related to (indirect) exports in the services sector.

4Import tariffs and product quality: a level playing field?

• Average import tariffs have been falling around the world for years. Although import duties regularly make the headlines when they are changed due to sanctions or a trade war, little attention is paid to the structure of the existing duties system.
• Research shows that the import of higher-quality products is generally subject to lower tariffs in the United States. As a result, people on lower incomes, who are more likely to buy lower-quality products, are taxed more heavily in relative terms.
• Research using Dutch trade data shows that this regressive pattern of taxation is also in place in the EU: lower-quality products are associated with higher import duties, and higher-quality products with lower duties. However, the phenomenon is much less pronounced than in the US.
• This regressive pattern is driven mainly by intermediate goods, and specifically chemical products and manufactured goods.
• The pattern not only affects consumers but also firms, especially independent SMEs. On average, independent SMEs have more inclusive workforces than larger firms, and are more likely to produce and import lower-quality product variants. The relatively higher costs that they pay for these products can reduce their profitability and therefore wages and opportunities for their workforce.