EU Gender-Quota Proposal Creates Quite the Stir

It appears agreeing on a proposal to require company boards in the European Union to be made up of at least 40 percent women is a bit dicier than some thought.

At least that’s what’s implied by Viviane Reding’s comments in this New York Times report about the European Commission postponing its decision on the proposal due to tough opposition and concerns over its legality. The proposal was initially scheduled for a ruling Oct. 23 and will now come up for discussion again on Nov. 14. (Here’s an earlier Times story that provides more background on the proposal.)

As Reding, the European commissioner for justice, said in the Oct. 23 piece, the figure being considered “is still 40 percent. But the way to arrive there has been looked at in a different way.”

The debate “was very intense,” she said, explaining that the discussion on the legality of any quota was one reason the meeting that day in Strasbourg, France took the several hours that it did. No doubt other reasons included Reding’s proposed penalities and sanctions that companies and organizations would face if they failed to improve their boards’ female representation.

According to the story, the issue has divided the European Union, with Britain leading the countries that regard the proposed rule as counterproductive and unworkable. Other countries taking that view include The Netherlands, Malta, the Czech Republic, Latvia and Bulgaria.

I went searching for the latest rundown on where all countries — including the United States — stand on female representation on boards of directors. Not a whole lot out there, but I did find this paper (free download included) by University of Pittsburgh School of Law professor Douglas M. Branson, An Australian Perspective on a Global Phenomenon: Initiatives to Place Women on Corporate Boards of Directors. According to his report on research he did:

The statistics indicating the representation of women on corporate boards vary widely from country to country. Norway, which passed its controversial quota law in 2003, in effect mandates that 40 percent of a public company’s directors be women by 2008, a goal which has been achieved.

According to Catalyst Inc. [a New York-based organization promoting inclusive workplaces], in the United States, the proportion of women on boards of large, publicly held companies stands at 16.1 percent, but with the proportion stagnant from 2004 onward. Portugal has the fewest females on corporate boards of publicly held corporations, accounting for just 6 percent.

Overall, the 2010 European average was 11.7 percent but, again, the numbers varied widely. After Norway, the highest five were: Sweden (28.2 percent), Finland (26 percent), Netherlands (20.9 percent), Denmark (14 percent), and the United Kingdom (11.5 percent). Besides Portugal, the laggards included Italy (3.6 percent), Luxembourg (6 percent) and Germany (7 percent).

Two years [2010 to 2012] have seen significant change, to between 13 percent and 14 percent. France, which adopted a quota law early in 2011, is thought to be responsible for half or more of the EU increase, with the percentage of women directors increasing from 12 percent to 24 percent in 14 months.

On the Pacific Rim, Australia leads among the countries from which statistics are available, with 13.8 percent. New Zealand follows with approximately 10 percent. Others in the queue include Hong Kong (8.9 percent) and Peoples Republic of China (7.2 percent). The caboose is Japan (1.4 percent).

Not sure where I stand on all this. Not sure quotas ever really improve the overall makeups of organizations or countries. My guess, though — having not been invited to that fiery Oct. 23 meeting — is that the lower-scoring entities “may protest [the most], methinks,” to (sort of) quote Shakespeare.