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EU vote on mandatory board gender quotas to be postponed until November


An anticipated vote on the introduction of a Europe-wide quota for women on company boards has been postponed until November in order to give commissioners "more time to reach an ambitious consensus," the European Commission has said.

The EU's executive branch met today to discuss Justice Commissioner Viviane Reding's proposal for a Directive mandating 40% female representation on the boards of publicly-traded companies by 2020. Reding has been asked to "water down" the proposals ahead of further discussions on 14 November, according to the Financial Times.

Posting on her Twitter account shortly after the meeting, Reding said that she would "not give up".

"Of course, there will be some opposition. But Europe has a lot to gain from more diverse corporate boards," she said on the social networking site earlier this week. "The European Parliament has called for action to get more women into boardrooms. The time to act is now."

Several EU member states including Belgium, France, Italy, the Netherlands and Spain have already introduced rules on gender quotas for company boards, while other countries have insisted on gender balance on the boards of state-owned companies. Norway, which is not an EU member, already has a 40% quota.

However other states, including the UK, have spoken out against the proposals and have instead argued in favour of voluntary targets.

Female representation on company boards across Europe's top companies has slightly increased from 11.8% in 2010 to 13.7% under the latest figures, according to a report (28-page / 385KB PDF) published by the European Commission in March. However, at only one board member in seven, it will take more than 40 years to reach a significant gender balance of at least 40% of each sex if the proportion of female board members increases at the same rate.

Last year Lord Davies led a review into gender diversity on company boards in the UK and recommended that the FTSE 100 leading companies by share capital should aim to have at least 25% female representation by 2015. He also suggested that the top 350 companies set out the percentage of women they aim to have on their boards in 2013 and 2015.

Draft regulations (21-page / 275KB PDF) aimed at improving the quality of companies' narrative reporting, published by the Department for Business, Innovation and Skills (BIS) last week, will require quoted companies to publish the number of women and men within their organisations, both overall and in senior executive positions. The Government has stated that this will allow investors to "identify gender imbalances" within an organisation and help companies address talent blockages.

Corporate law expert Martin Webster said that the UK's "soft target" approach would receive a "big boost" if Reding's proposals were not ultimately backed by the European Commission.

"However, those who favour targets will then have to live up to their rhetoric and if the 25% figure for women on boards is not achieved by 2015 as Lord Davies urged, the argument in favour of quotas could be reignited," he said. "And we shouldn't forget that the European Parliament is very interested in this topic and any decision by the Commission may not deflect their enthusiasm for quotas."

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