By Melissa J. Anderson (New York City)
Recently it was revealed that the European Union’s justice commissioner Viviane Reding was likely to move forward with a proposal to implement boardroom gender quotas. The Financial Times reported that companies throughout the EU’s 27 member states will have to meet a 40 percent target for women board directors.
The FT’s James Fontanella-Khan writes:
“According to the draft, companies larger than 250 employees or with more than €50m in revenues would be required to report annually on the gender make-up of their boards. Those that miss the mandatory quota would be subject to administrative fines or be barred from state aid and contracts.”
Furthermore, a report by the New York Times continued, while publicly traded companies will have until 2020 to meet the target, state-owned companies will have to do so by 2018.
The news comes off the back of two recent studies that showed how personal networks make a huge difference when it comes to board appointments – “who you know” significantly influences which boards you’ll be appointed to, and how much you’ll get paid.
And because most boardrooms in the UK and around the world are dominated by men, women have less of an opportunity to break through – simply because of whose personal networks they belong to and in what context they are there. The research shows that networks matter – and that’s why gender quotas may help close the gap.