Quota U turn

European politicians have done a complete U-turn on plans mooted earlier this year which required listed companies in the region hire female executives onto their boards in an effort to boost the numbers of women in senior management or face sanctions if they failed to do so.

According to the FT the revised legislation still recommends a 40% quota but companies will no longer face sanctions if they do not comply with the rules.

The initial suggestions, pushed for by the EU justice commissioner Viviane Reding, has also been revised to give member states the room to introduce fairer methods to encourage more women being hired into board roles.

The EU’s decision – in light of statistics which show that women only fill 13.7% of board positions among listed companies – comes as the legal service found that mandatory gender caps contravened other treaties.

Reding admitted she would have preferred a ‘stronger proposal’ and had been forced to water down the plans to obtain approval.

She continued:

‘I continue to believe that the case-law of the court of Justice of the European Union allows a legally binding quantitative target in favour of the under-represented sex if based on equal qualification, as initially proposed.’

‘However, the co-signatories of the proposal and I also understand the concerns expressed by several of you, and we are willing to move towards a compromise text.’