European Parliament backs 40% target for women on listed company boards

Companies listed in the European Union could be urged to target 40% of their non-executive board posts filled by women by 2020 following votes at the European Parliament late yesterday (October 14).

The Parliament’s Women’s Rights/Gender Equality and Legal Affairs committees, in a joint meeting, backed draft rules proposed by the European Commission, the executive branch of the EU.
In 2012, only 15% of non-executive board members at the EU’s largest companies were women, they said.
“What is currently a reality in some EU member states will soon be extended to the single market as a whole and all EU listed companies, thereby making the most of the talents of many qualified and highly skilled women”, said Rodi Kratsa-Tsagaropoulou, the Greek MEP who is one of the ‘rapporteurs’ of the proposal.

It was now up to the heads of state-level European Council to agree a “common position” so that negotiations between the Council and Parliament could go ahead, added co-rapporteur, Austria’s Evelyn Regner.Under the draft plan, listed companies would have until 2020 to reach the target while public ones should do so by 2018. The rules would not apply to small and medium-sized enterprises.
The committees called for “transparent, open and meritocratic” recruitment in which gender balance is borne in mind throughout. Where candidates are equally well qualified, priority should go to the candidate of the under-represented sex, they added.
Companies that fail to abide by the rules will be required to explain why to the competent national authorities in member states and describe the measures taken and planned to achieve it in future.

MEPs say that penalties, such as fines, should be imposed for failing to follow transparent and open appointment procedures, rather than for failing to achieve the target.
They propose that “exclusion from public calls for tenders” should be added to the list of possible penalties. Link