Ethical Performance
inside intelligence for responsible business


EU gets tough on women's representation within company boardrooms

October 2012

EU legislation will be proposed this month compelling state-owned and private companies to allocate at least 40% of supervisory board seats to women.

Under the proposals, from justice commissioner Viviane Reding, state-owned companies would have to comply by 2018 and publicly-listed companies by 2020.
Reding has said legislation is necessary because self-regulation has failed, but powerful sections of industry object to the 40% 'gender-balanced' minimum, which would also apply to men.

“Big divergences among sectors and national traditions mean any measures must remain voluntary,” said Kimberley Lansford, policy adviser at the European Round Table of Industrialists, a forum for multinationals' leaders. Some technology and manufacturing companies oppose the move because there of the scarcity of qualified women in certain sectors.

Proposed action for non-compliance includes fines, exclusion from public contract bids, restricted access to subsidies and orders to reverse unacceptable appointments.

If the proposals are agreed by the European Commission, they would need approval by the European Parliament and the 27 EU members. At the same time, the EU will conduct a public consultation on the impact of legislation.

Reding has said countries with quotas “bring the results”, and an EU study of women in economic decision-making says in a progress report that companies with women in senior jobs consistently outperform their competitors.

The report reveals that in January female board representation in the EU's largest companies was on average 13.7%, compared with 11.8% in 2010, and the proportion of female chairpersons 3.2%, against 3.4% in 2010. It observes that change at this pace would take more than 40 years to achieve gender-balanced boards.

Europe | Equality


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