Business leaders should pledge to have more women on boards: EU

Self-regulation 'given a chance' for 12 months

Business leaders should sign a pledge to have women make up 30 per cent of their boards of directors by 2015 and 40 per cent by 2020, according to Viviane Reding, vice-president of the European Commission, the executive body of the European Union.

“For the next 12 months, I want to give self-regulation a last chance. I would like companies to be creative so that regulators do not have to become creative,” she said, according to media reports.

At a summit in Brussels this week, Reding met with CEOs and chairs of boards of publicly listed companies from 10 European countries to discuss how to get more women into top jobs and whether self-regulation or regulation should be the way to make significant changes quickly.

This issue was initially raised in September 2010 when the European Commission, following a proposal by Reding in Gender Equality Strategy, said it will "consider targeted initiatives to improve the gender balance in decision-making.”

Just one in 10 board members at Europe's biggest companies are women and in 97 per cent of these cases the board is chaired by a man, according to the European Union. But studies show businesses with more women at the top outperform “men-only” companies, with higher operating income and better attraction of talent and understanding customers, it said.

Over the next 12 months, the commission will monitor progress and then assess whether further measures are required.

"I want to send a clear message to corporate Europe: Women mean business," said Reding. "We need to use all of our society’s talents to ensure that Europe’s economy takes off. This is why the dialogue between the commission and the social partners is so important. I believe that self-regulation could make a difference if it is credible and effective across Europe. However, I will come back to the matter in a year. If self-regulation fails, I am prepared to take further action at EU level."

While progress on reaching a reasonable balance between the genders has been slow in Europe, some countries are making progress. Finland, Sweden, the Netherlands and Denmark have introduced corporate governance codes or voluntary charters that have led to more women getting on boards, said the EU. Legislation on quotas has also been introduced in Norway and is now being implemented in France and Spain. It’s also under discussion in the Netherlands, Italy and Belgium.

In Canada, women continue to make little progress when it comes to increasing their representation on the boards of Financial Post 500 companies, according to the 2009 Catalyst Census: Financial Post 500 Women Board Directors. Catalyst is a New York-based research and advisory organization that promotes women in business.

In 2009, just 14 per cent of directors were women, up from 13 per cent in 2007, the last time the census was conducted.

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