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Doing business in Denmark

A unique work-life balance environment!

Photograph: iStock

Text: Mariano Anthony Davies

Denmark has managed to build a professional business environment within a globally recognised social welfare safety net.

Poverty is a very relative term in Denmark, where there are a variety of robust social welfare systems to ensure that no one falls through the cracks. This is one of the reasons why the Danish flexicurity business employment model works so well. Consequently, a combination of the Danish social welfare safety net and the general willingness to carry out re-education are the basis of a country that is also an excellent place to do business.


Denmark's famous labour market model (Flexicurity) is widely admired for its ability to reflect the needs of employers while, at the same time, safeguarding the welfare of employees.

The model has three core elements:

  • Employers have the right to hire and fire at will and do so without excessive costs for dismissing employees. Noticeably, litigation surrounding dismissals is uncommon.

  • Employees who join and pay subscription fees to an unemployment insurance fund get up to two years' unemployment benefit after losing their jobs.

  • The Danish Government runs education and retraining programmes as well as counselling services to get unemployed people back to work as quickly as possible. These are remarkably successful even though unemployment rose from 4% (prior to COVID-19) to 6.2% but has fallen again to 4.6% (March 2021).

Additionally, the Danish State safety net includes providing basic subsistence allowance payments for people who lose their livelihood due to illness, divorce or unemployment, and who do not qualify under other social welfare schemes such as pension or unemployment benefit.

The Danish DNA

The Vikings were great traders – a skill we still see clearly in the Danish DNA and this has brought them great success regionally, internationally and globally with a very distinctive business footprint.

Geographically, well-positioned between the Nordic countries and the rest of Europe, linguistic malleability has also helped Denmark develop a pool of talented professionals who speak English well and German. Furthermore, it is noteworthy that Danish business infrastructure is top-class, with reliable supplies of electricity and water as well as a well-developed financial system.

The World Bank has concluded that as a business environment, Denmark is best in Europe and fourth in the world for ease of business.

Let's look at some recent statistics. The World Bank has concluded that as a business environment, Denmark is best in Europe and fourth in the world for ease of business. Furthermore, according to Forbes Business Magazine, Denmark is the seventh most inviting country for capital investment despite the high taxes associated with the functional social welfare state.

Cleantech and life science

Despite its size, Denmark has become home to world-class companies in several industries, focusing on renewable energy. Ambitious energy policies have helped put Denmark at the forefront of "cleantech", and the country has a goal of being completely independent of all fossil fuels by 2050. However, this is a much-discussed strategic goal, which will be very costly to achieve now.

Denmark also has one of the strongest clusters globally when it comes to biotech and life science, bridging across to Southern Sweden. This cluster is based on robust public-private partnerships and has attracted leading companies from all over the world. This has created a respected and efficient R&D environment.


Viking maritime knowledge has culminated in modern times with a merchant shipping footprint that is the sixth-largest in operational tonnage. The world's leading container shipping operator (Maersk Line) is Danish and still has its headquarters in Copenhagen – annually transporting over 12 million containers to ports worldwide.

Work-Life balance

Foreigners who join Danish business teams have commented that the Danish way of working is highly focused during working hours (including a brief 30-minute lunch break) and then a late-afternoon shift to family and personal time. Not many Danes (beyond executives) stay at the office after 4.30 PM or 5.00 PM.

What is noticeable is that Danes seem to be highly effective while at work and have been found by many international companies to be just as effective as those in other countries who spend many more hours a day at the office.

This work-life balance makes for happier employees and strong families. Add to this an effective national network of quality subsidised child-care facilities, which gives Danish women the opportunity to compete on equal footing with Danish men.

There is no legal minimum wage in Denmark. Instead, the relatively high wages are set as part of the regular negotiations between employers and labour unions. Even though around 67 % of Danish workers are union members, strikes are uncommon, because both sides seem to feel a duty to reach an agreement that will benefit society at large.

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The article is a commendable analysis of the unique aspects of Danish business culture. It provides invaluable insights for international enterprises, such as Metro Sales, aiming to expand their footprint in Denmark. The importance of understanding and adapting to the Danish approach towards work-life balance, flat hierarchies, and the value they place on creativity and innovation cannot be underestimated. As a company with an impressive array of advanced office technology, Metro Sales would do well to understand these nuances. This article underscores how aligning business strategy to local cultures can contribute to success.

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