The European Parliament has passed a law requiring a hefty quota of women on the boards of listed companies in all EU member countries.
Women must fill one-third of all director posts or at least 40 percent of non-executive director posts.
The positions must be filled by July 2026, in line with the new Women on Boards Directive.
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The directive was originally proposed back in 2021, but was postponed for over a decade due to objections from some member states.
It states that candidates must be equally qualified for a gender-based preference to be made, so that boards do not accept inferior directors to meet the quota.
Each member country can set its own targets and create its own system in law over the next two years, as long as it meets or exceeds the EU directive.
And each listed company is free to establish its own selection and appointment procedures, as long as they are fair, transparent and reported annually.
Statistics from the the European Institute on Gender Equality (EIGE) show that countries with binding quotas have quadrupled female board representation from 10.6 percent to 38.8 percent from 2010-2022.
Those with ‘soft’ quotas have increased the representation of women, but less, from 12.4 percent to 30.7 percent.
“This is a long-awaited moment, a moment to be celebrated as a breakthrough in gender equality,” EU Parliament president Ursula von der Leyen, vice-president Věra Jourová and commissioner Helena Dalli said in a joint statement.
“After 10 years since its proposal by the European Commission, we will now have an EU law to break the glass ceiling of listed companies’ boards.
“There are plenty of women qualified for top jobs and with our new European law, we will make sure that they have a real chance to get them.”