German businesses are waking up to the potential of refugees

In her New Year’s address, German chancellor Angela Merkel urged her compatriots to view the almost 1.1 million refugees that arrived in Germany in 2015 as an “opportunity for tomorrow.”

Merkel did not mention the critical role of corporations in the process of integrating refugees, but many German companies already seize the opportunity. In fact, the decisiveness and speed of some German businesses to set up integration programmes for refugees can be regarded as an example for companies across Europe.

In November 2015, German car manufacturers Daimler and BMW Group launched pilot programmes to employ refugees in short-term training initiatives, including free German language classes. Developing language skills and skills relevant for potential future employment options facilitates integration. The programmes are limited to only 40 trainees each in a first pilot phase. Both companies are working closely with Germany’s Federal Agency of Employment to select the most suitable candidates, and to extend the initial test phase to other production sites and to more participants.

Running these integration programmes isn’t easy. Unless the German government clarifies the employment status of refugees, the sustainability of these programmes is uncertain. After all, companies are currently investing valuable resources in training workers that they may not be able to employ long-term because the decision over their application for asylum is still pending.

It is, therefore, the government’s task to improve administrative processes and regulation in this context. Getting rid of administrative barriers and clarifying the residence status of refugees quicker to enable long-term employment would encourage more companies to develop similar programmes. Corporations already engaged in supporting refugees are gambling by taking the time to invest resources in training, but their risks in doing so are low; processing the applications of refugees from conflict regions takes time, but their acceptance by the German government is almost certain.

Investing in tomorrow

Daimler and BMW Group have strong human rights policies in place and see their engagement for refugees as part of their commitment to human rights. Milagros Caiña-Andree, a member of BMW Group’s Board of Management, who is responsible for human resources, recently said, “It is only natural for us to help integrate people who were forced to leave their home and come here.”

One of the biggest concerns that right-wing political groups such as the German Pegida or the French Front National raise is that refugees might take away jobs from European citizens with a similar level of education. On the contrary, though, Michael Brecht, Chairman of the General Works Council at Daimler, points out: “The ‘bridge interns’ are not in competition with temporary agency workers or our core workforce. This programme does not put anybody at a disadvantage.”

Daimler’s CEO Dieter Zetsche also explains why he considers refugees valuable assets for Germany’s workforce: “Most of the refugees are young, well-trained and highly motivated. That’s exactly the sort of person we’re looking for.”

Besides big corporations that are listed on the German stock exchange, many small and medium-sized companies have also started to fill the ever-increasing number of vacant apprenticeships with refugees, a move to compensate for too few German high school graduates that are interested in getting into these professions.

Other companies have launched internship programmes similar to Daimler and BMW, albeit on a smaller scale. Some companies are also well aware that their product and services may be harmful for refugees, and are making business decisions accordingly. For example, Mutanox, a Berlin-based fence company, refused to sell razor wire to the Hungarian government, knowing that it would be used to build a fence to keep refugees out of the country.

In the rest of Europe, however, company engagement on these issues is still limited.

Human rights lens

In October 2015, the Business & Human Rights Resource Centre, a non-profit organisation in London, reached out to 35 companies in Europe to ask for their reactions to the refugee crisis. Only 15 replied, the majority of which were German companies.

The fact that German businesses have led the way can partly be explained by a decline of the German workforce. Owing to an aging population, Germany will need to import additional workers in the next decades. The German Federation of Industry as well as the German Federation of Employers therefore welcome the influx of refugees.

According to the BHRRC’s study, German companies’ engagement toward refugees falls into three categories: (1) Engagement for refugees in core business, (2) Public commitment for societal and governmental action to integrate refugees, and (3) “Philanthrophic” commitments such as charity donations. This shows that while German companies are probably under the greatest pressure to do something for refugees, the ways they do so vary.

The integration of refugees can also be seen as a positive case for business and human rights – an opportunity for businesses to step up and speak out for refugees who have been deprived of their basic rights in the context of conflict. Irrespective of the potential economic benefits of the influx of refugees, some companies are therefore approaching the topic through a human rights lens by establishing cross-departmental forces to set up integration programmes.

Corporate integration programmes play a critical role for what Merkel described as the greatest political challenge since German reunification. Government and the private sector, together with civil society, need to work in unison to address refugee integration.

Speed is of the essence. Recent figures documented by The Economist confirm that refugees could be an “asset, not a liability” to the labour market of arrival countries if they could start working sooner. The programmes set up by Daimler and BMW Group show what corporations can already do, but more companies – not just in Germany, but across Europe – need to engage in order to have a real impact on refugees’ lives. Corporate engagement must go beyond philanthropy and integrate refugees in core operations, like the German automobile industry’s training programmes. Only then can Chancellor Merkel’s mantra, “wir schaffen das (we can do it)”, become a reality.

Dorothée Baumann-Pauly is the research director at the Center for Business and Human Rights at NYU Stern School of Business.

Isabel Ebert reports for the Business & Human Rights Resource Centre in Germany, Austria and Switzerland.