July 30 2014 Latest news:
Saturday, March 17, 2012
The European Commission is gearing up to break through the glass ceiling and get more women onto company boards.
This month, a European Commission report showed that only limited voluntary progress to increase the number of women on company boards had been achieved, despite calls from EU Justice Commissioner, Vivian Reding for credible, voluntary self-regulatory measures.
Just one in seven board members in Europe’s top firms are women (13.7pc). At this rate it will take 40 years before we see equality in the boardroom. The EU has now embarked upon a period of consultation, March 5 to May 28 2012; the objective of which is to determine whether to propose enforceable legislation.
This follows the 2011 French quota law, which has seen board representation for women jump from 12 to 22pc. The strictest measurers are in force in Norway, where a 40pc female quota is law. Legislation produced a rise in female board members from 6 to 39.6pc during the period 2007 - 2009.
In Norway, publicly listed companies can be dissolved if they fail to reach the quota. However the transition was not without it’s detractors, companies opposed and indeed campaigned against quotas, but once legislation was passed, CEOs could chose up to three qualified executive women to complete competence training and relevant networking opportunities in preparation for a position on the board.
In all 600 women completed the specialised training and half are now employed on Norwegian boards. Previously, Norwegian companies had been given two years (2003 - 2005) to voluntarily boost their female quotas, but the increase was only 1pc, a mirror of the reaction to the challenge set by Viviane Reding last year. The EU Justice Commissioner’s challenge, to all EU publicly listed companies, was to sign a voluntary pledge to increase the presence of women on their boards to 30pc by 2015 and 40pc by 2020. The take up was nothing short of dismal.
As compelling as the Norwegian model is, if the EU does decide to throw it’s weight behind legislative change there will be a voracious backlash of arguments against mandatory equality in the boardroom. Detractors will cite positive discrimination as a bad thing and talk of ‘token women’ being on the board simply to appease an arbitrary quota requirement.
Christine Lagarde, the former French economics minister and now head of the International Monetary Fund, says she initially dismissed the notion of quotas, but now sees no contradiction between engineering gender balance and free market principles; she is quoted as saying “If we’d had more Lehman Sisters than Lehman Brothers the world would be a different place.”
Women across the globe, be it in Europe, the USA or Asia represent half of the world’s labour force. In the UK women have been active in the workforce since World War II. Women’s presence in the workplace has heralded positive change, new ways of managing people and collaborative team working. Childcare responsibilities have challenged commonly held concepts of the work life balance and paved the way for flexible working practice.
Moreover, women are instrumental in wealth creation. The United Nations published a report in 2003, corroborated by the World Bank, documenting that societies that discriminate by gender tend to experience slower economic growth.
That said, I am not of the view that quotas per se are the answer. Particularly if they are bludgeoned in. My fear is that quotas will give those that oppose gender equality, for whatever latent reason, an excuse to vent misguided sexism; no doubt borne out of a fear for their own position. Any woman brought in under the heading of a quota may feel she has gained her position by default.
We need to see the full and unequivocal engagement of CEOs and board chairmeb and a cultural shift away from the conscious or indeed unconscious bias towards senior women in organisations.
We need women to put their heads above the parapet, engage in self promotion and recognise the value and expertise they bring.
The answer to the lack of women in the boardroom is; a combination of cultural shift, an embrace and acceptance of the benefits of diversity in wealth creation and the introduction of supportive legislative measures. As and when we have a level playing field women can be free to demonstrate their capabilities and commitment; unhindered by bias and gender stereotyping.
It is the region’s newest sports car - fast, sleek in design and bearing a £25,000 price tag.