RENFORCE Blog

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What role can or should the European or national legislator play in ensuring gender balanced company boards?

Pictogram of a woman with a tie and men, symbolic image for women's quotaEquality between women and men is a fundamental principle of the European Union. However, there is still an unequal representation of women in decision-making positions in companies throughout the EU. Even though the situation has started to improve, women remain a minority at the top of the decision-making hierarchy. On Wednesday 9 December 2015, this issue will be discussed at the seminar on Gender Balanced Company Boards in the EU at Utrecht University.

This conference will bring together views from industry, policy-makers and academia. The different national regulatory and enforcement approaches, the European Commission’s legislative proposal to regulate this matter, as well as best practices to effectively deal with the underrepresentation of women in company boards will be discussed. This seminar is organized under the auspices of the Utrecht Centre for Regulation and Enforcement in Europe (RENFORCE) and the Centre for Inclusive Leadership. The invited speakers will discuss both the role of private actors and the role that European or national legislators or other public authorities may play in ensuring gender balance in company boards. The timing of this conference is particularly interesting due to recent developments on the EU and national level.

On the EU level, the Council of the European Union was not able to agree on the proposal for a Directive on improving the gender balance among non-executive directors of companies listed on stock exchanges this week. Although there is a broad consensus across the EU in favour of taking measures to improve the gender balance on company boards, some EU member states prefer to do so at the national level. The Council calls on Member States and the Commission to “consider a broad range of different measures, legislative and/or non-legislative, voluntary or binding” in order to improve the gender balance in decision-making bodies.

On the national level, the Dutch law (see: here and here) involving a 30% quota for women on the board of directors and the supervisory boards of larger companies expires 1 January 2016. Nonetheless, the Dutch Minister for Education, Culture and Science, who is also responsible for the emancipation of women, recently announced that the quota will continue to apply, but may decrease to 20%. However, the official proposal for the amendment of the law has not been published yet. Despite this, the Minister has announced that enforcement of the quota will be intensified next year. Currently, companies failing to comply with the quota requirement are obliged to explain in their annual reports (1) why there is no balanced division of the seats in the board of directors and the supervisory board, (2) which efforts the company has taken in order to reach a balanced division of the seats in the boards and (3) how the company aims to reach a balanced division in the future.