Boardroom Diversity in the EU

Abstract

In a concerted effort to bring about change in the gender balance of European corporate boards, a European Commission report released earlier this year sets out the many advantages of having greater gender diversity on boards. The report contends that providing a better balance of gender on boards will bring about company outperformance, higher returns, better risk management, and a better representation of society. It also highlights the limited progress being made across the EU. Of the 600 or so largest companies listed in the EU, women account for only 3.2% of the position of chairperson or president, and among boards of the largest companies in the EU, women make up only 13.7% of the average board. Although the latter at a rate of 1.5% a year over the recent past, the rate has not matched the results of EU countries that have adopted quotas for their own national policies—France, Italy, the Netherlands, and Spain. Even so, this rate of growth has not impressed the European Commission, which is proposing a mandatory quota of at least 40% of non-executive positions to be held by women. Certain countries feel that EU-wide mandatory quotas