To close the gender gap in corporate boardrooms, several European countries have introduced gender quotas in recent years, mandating that companies reserve a certain percentage of board seats for women. Some members of the US Congress have considered trying to do the same. Although critics of quotas contend that they are too blunt an instrument and run the risk of saddling organizations with unqualified directors, even the critics admit that when it comes to improving gender parity, they’ve been remarkably successful. Oliver Staley has the story at Quartz:
That’s the view of Rajeev Vasudeva, the CEO of Egon Zehnder, one of Europe’s largest executive search firms. Vasuveda said he’s no fan of quotas, but concedes they’re having an impact. “I’m not a great supporter of quotas but in this case it’s making difference,” he said in an interview. “It has changed the conversation—it clearly has been put on the agenda of companies.”
Norway was the first to introduce quotas for women in 2003, requiring that public companies fill at least 40% of their board seats or risk dissolution. Iceland, Spain and France followed with 40% targets—although with less severe penalties—and other countries have lower thresholds. Last year, Germany became the largest economy to impose a quota, mandating 30% of supervisory board seats be filled by women.
Across Europe, the number of women on boards is climbing, although from a low base. The number of women board members at 734 large publicly traded companies across the Europe is now 23%, up from 11% in 2007, according to EU data. In countries with quotas in place, it’s higher: 44% in Iceland, 39% in Norway, 36% in France and 26% in Germany.
If these quotas are enough to bring women’s representation to 30 or 40 percent, the next big question is whether that figure ever climbs higher than that. The hope would be that having boards that are 40 percent women will prove to be such a good thing, companies will voluntarily add enough female directors to get to 50 or even 60 percent. Yet as in the case of the NFL’s Rooney Rule, it remains to be seen whether this legislation will really have the long-term effect of changing minds about gender in the boardroom. I suspect that laws create compliance, but it’ll take more than that to change mindsets.