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EU action to promote gender balance in decision-making

The EU takes a series of actions to promote gender equality in decision-making including proposing legislation where relevant.

The Commission’s Strategy

The EU Gender Equality Strategy 2020-2025  presents policy objectives and actions to make significant progress by 2025 towards a gender-equal Europe. The goal is a Union where women and men, girls and boys, in all their diversity, are free to pursue their chosen path in life, have equal opportunities to thrive, and can equally participate in and lead our European society. One of its key objectives is achieving gender balance in decision-making.

The European Commission continues to encourage and support EU Member States and stakeholders in developing and implementing effective strategies to achieve balanced participation of women and men in decision-making. These actions include: 

  • raising awareness.
  • political dialogue.
  • mutual learning and exchange of good practices including through the Mutual Learning Programme in Gender Equality and the Platform of Diversity Charters.
  • funding projects to develop and support strategies and tools for positive change.
  • disseminate data and analysis of trends and good practice on women and men in decision-making positions in cooperation with the European Institute for Gender Equality.

The Commission will lead by example. It aims to reach gender balance of 50% at all levels of its management by the end of 2024. Supporting measures will include quantitative targets for female appointments and leadership development programmes. The Commission will also increase efforts towards reaching a larger share of female managers in EU agencies, and will ensure gender balanced representation among speakers and panellists in the conferences it organises. 

Legislation – Proposal on gender balance in company boards

In November 2012, the European Commission proposed legislation that seeks to improve the gender balance in corporate decision-making positions in the EU largest listed companies.

At the heart of the proposal lies a transparent selection process of the board members based on clear criteria and a comparison of the candidates' qualifications – to be implemented by large listed companies that do not meet the target of 40% for non-executive directors (or 33 % for all types of directors) have to ensure fair and transparent selection procedures for the selection of candidates for board positions.

This approach respects a candidate’s qualifications and merit as the decisive criteria. The criteria for board positions are to be established by the companies themselves. Suitability, competence and professional performance, not gender, will remain the key factors for the selection process. Only when two candidates are equally qualified should the choice be made in favour of the underrepresented sex.

On 7 June 2022, a political agreement was reached between the European Parliament and the Council on the Commission’ proposal.

The agreed Directive will ensure that gender balance in corporate boards of listed companies is improved across the EU, while allowing for flexibility for Member States that have adopted equally effective measures. This flexibility will allow for the suspension of the procedural requirements set out in the Directive.

The political agreement reached by the European Parliament and the Council is now subject to formal approval by the co-legislators. Once published in the Official Journal, the Directive will enter into force 20 days after publication and Member States will then need to transpose the new elements of the Directive into national law within two years.

Key provisions of the directive

The new Directive sets a target for large-listed EU companies to accelerate progress towards gender balance in their boards – aiming at least at 40 % among non-executive board members or 33% among all directors of the under-represented sex by 30 June 2026.

Companies with a lower share will be required to make appointments on the basis of a comparative analysis of the qualification of candidates by applying clear, gender-neutral and unambiguous criteria and to ensure that applicants are assessed objectively based on their individual merits, irrespective of gender.

This approach respects a candidate’s qualifications and merit as the decisive criteria. The criteria for board positions are to be established by the companies themselves. Suitability, competence and professional performance, not gender, will remain the key factors for the selection process. Only when two candidates are equally qualified should the choice be made in favour of the underrepresented sex.

Large-listed companies will also have to undertake individual commitments to reach gender balance among their executive board members.

Companies that fail to meet the objective of the directive must report the reasons and the measures they are taking to address this shortcoming.

Member States’ penalties for companies that fail to comply with selection and reporting obligations must be effective, proportionate and dissuasive. They could include fines and nullity or annulment of the contested director’s appointment. Member States will also publish information on companies that are reaching targets, which would serve as peer-pressure to complement enforcement.

The adopted Directive will ensure that gender balance in corporate boards of listed companies is improved across the EU, while allowing for flexibility for Member States that have adopted equally effective measures. It recognises that some Member States have chosen other promising options for improving gender balance on company boards and allows those Member States to pursue their respective approaches instead of the procedural requirements of the directive provided that these deliver concrete results.

The directive is meant to be temporary and is set to expire on 31 December 2038.

Monitoring

The  Commission monitors the situation on women and men in decision-making positions through its annual report on equality between women and men.

Documents

22 NOVEMBER 2022
Directive on gender balance in corporate boards
English
(342.18 KB - HTML)
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22 NOVEMBER 2022
Factsheet on gender balance on corporate boards
English
(750.02 KB - PDF)
Download