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Women In The Boardroom Quotas

by Jo Shaer, on January 10, 2013

women in the boardroom quotasI've been enjoying Hilary Devey's programme on BBC2 about Women At The Top.

Whilst providing half of Britain's workforce, business is still dominated by the men in grey suits and women make up only one in five of senior management in a boardroom position.

The facts have shown that mixed gender teams can achieve 5% better business results and Hilary herself discovered that the department in her company which performed the best was a 50:50 mixed gender split.

Across Europe, things are little different with figures from the beginning of the year showing that only 3.2% of the presidents and chairmen of large companies in the EU were women and only 13.7% of boardroom seats were taken by women.

It is this which has led to the European Commissioner, Viviane Reding announcing an initiative to make Boardroom Quotas that women occupy up to 60% of the seats on corporate boards part of legislation for all members of the European Union.

She herself does not like quotas but they open the way to equality and countries that had implemented them had seen results. And this statement was echoed by Hilary.

Where did these Boardroom Quotas start?

The legislation itself came into being in the Norwegian Parliament in 2002. The Trade Minister, Ansgar Gabrielsen, insists that he has never been a feminist but he was influenced by a debate in the mid 1990s which had focused on the vast amounts of money spent on educating the daughters of Norway over the previous three decades which had resulted in only 6% of them getting onto the boards of the most respected companies.

He did not speak to his prime minister or to his government colleagues, he announced the legislation in a newspaper interview. 'It was a revolutionary idea and it had to be done in a revolutionary way'

A decade on, 44% of the seats in the boardrooms of public companies are now occupied by women, aided by almost a year of full maternity pay and state subsidised nurseries. They bring something different to the boardroom because they ask the difficult questions - and sometimes the stupid ones which need to be addressed too.

However, the position of CEO is still dominated by men with only 2% of females having that title. Quota legislation has not helped them get to the top yet but it's necessary in order to allow them to reach the pool from which to be selected.

The quota system in Parliament

Back in Britain, Barbara Follet talked about the old boys network in our own Parliament. These days one in five of our MPs are women but in the 1990s it was one in ten.

Few women bothered to stand for Parliament because there was a system where the men were given the safe seats and the women had to fight for the unsafe seats. Labour introduced a quota system which meant that local parties were forced to choose from an all female shortlist. In the 1997 General Election, over 100 women entered Parliament as Blair's Babes.

The main argument against the quota system is will it allow the best person to get the job? So can it work in business? Well, there is just as much of an old boys' network there as there was in Parliament.

The quota system allows for a greater examination of the people being considered for a job - they have not just been shoed in thanks to their connections.

Progress needs to see some positive action and this is a short term measure to correct a long term imbalance.

Is there another way?

With 83% of FTSE 100, 89% of FTSE 250 and 92% of FTSE 350 company board members being men, Lord Mervyn Davies was asked to break up this monopoly.

He said that they needed to smash what is an all male solution and his solution was to set targets for women on boards.

25% of the board had to be women by 2015 and companies were encouraged to publish how many women employees they had and how many were getting to the executive committee and the board.

In France and Norway this figure was set at 40% but the feeling was that this figure became a quota rather than a voluntary attempt at self regulation and business women themselves do not necessarily want the quota unless this initiative does not work.

Businesses have to be allowed to adjust and believe in the culture behind it because it will be better for both society and business in the future.

But it was also about allowing chief executives to become aware of those business women who were ready for board positions and there are various networking groups and clubs which help those aspiring women to get noticed.

As a result the number of women entering the boardroom has risen sharply in the last year, with 1 in 4 businesses now reaching that target of 25% and another figure was quoted that in the last two months 48% of appointments to the boards of FTSE 100 companies were women.


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Topics:women in business

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