Gender quotas are 'hammer to smash the glass ceiling' for women

Written by Viviane Reding on 10 December 2014 in Opinion
Opinion

Europe has plenty of talented women, but their gender is stifling their success and this is undermining our economy, writes Viviane Reding.

Although the EU has done a lot in the past decades for women's rights, one major issue where progress is insufficient is gender equality in corporate boardrooms. Data from April 2014 shows that 81.4 per cent of board members of large listed companies in the EU are men. At the same time, 60 per cent of new university graduates in Europe are women. Apparently, there is a major problem because so many female talents are blocked.

This is not only a problem from the perspective of women's rights. It is also an economic problem for Europe. Scientific evidence shows that a broad range of talents and skills in the boardroom improves business performance and drives economic growth. It directly concerns our competitiveness. Demographic change and an ageing society deepen the need for more women at work, especially highly qualified women.

"No woman will get a job simply because of her gender. But no woman will be denied a job because of her gender either"

For years, European politicians followed a self-regulation approach. This has proven to be nowhere near enough. No significant progress could be made. Therefore, at the end of 2012, in my function as commissioner for justice, I presented the EU directive on improving the gender balance in company boardrooms. The directive is targeted to the highest corporate levels, in order to send a signal that big names should lead by example by providing new role models for women. Suggesting a 40 per cent quota for non-executive directors by 2020 for large listed companies in Europe, the proposal was approved by the college of the European commission.

The approach we offered up favours the promotion of talent. If a candidate for a supervisory board position of the under-represented gender is as well qualified as a candidate of the over-represented gender, the candidate of the under represented gender must be given priority.

This continues to be the case until the under-represented gender has reached 40 per cent representation on the supervisory board.

However, the under-represented gender does not have to be appointed preferentially in every case. The directive, in accordance with the case law of the European court of justice, expressly provides the possibility of an individual assessment which may also lead to the other candidate being selected. This means that the EU quota directive does not regulate the specific selection of one particular person. The appointment or the selection is still decided by the relevant body within the company.

"Data from April 2014 shows that 81.4 per cent of board members of large listed companies in the EU are men. At the same time, 60 per cent of new university graduates in Europe are women"

Essentially, qualification and merit remain the key. All candidates will have to jump through the same hoops to land a job on a board. No woman will get a job simply because of her gender. But no woman will be denied a job because of her gender either. The job will always go to the best candidate. The directive will serve as a springboard, handing women the hammer they need to smash the glass ceiling.

The law is not yet in force. However, the accelerated progress driven by political and regulatory pressure can be observed. The push for gender balance on boards is gathering steam in Europe. Since I first announced my intention to legislate in 2010, there has been an increase in women on boards, from 11.9 per cent to 18.6 per cent in just four years. This is already a small achievement.

Now that the European parliament has endorsed the directive proposal with an overwhelming majority, it is now up to member states and EU leaders to show political will. They must take their responsibility to empower women to break the glass ceiling. They should do so not only for the sake of women, but for the equilibrium of society and the promotion of talent in the economy. The time to act is now.

 

About the author

Viviane Reding is former commissioner for justice, fundamental rights and citizenship and a member of parliament's international trade committee

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