Can gender quotas get more women into boardrooms?

Most agree there aren’t enough women in corporate boardrooms, but there’s little consensus on how best to improve numbers and diversity. Some countries tackle the issue with voluntary targets, while others employ tougher legislative measures such as binding quotas.

In Europe, binding gender quotas are increasingly prevalent. In March, Germany became the latest to make quotas mandatory. Starting in 2016, major German companies will need to fill 30 per cent of non-executive board seats with women. Norway, Italy, France, and Spain in already had such a policy.

Still, the 28 countries in the European Union are far from unanimous on how to get more women into boardrooms. Earlier this month, EU attempts to speed up and unify change ran into opposition. The European Commission’s proposal to raise the proportion of all types of female directors of publicly listed companies to 33 per cent by 2020 was watered down to 20 per cent after some countries favoured non-binding measures to boost female representation.

The U.K. has not gone down the quota route, instead favouring voluntary target-setting and a corporate governance code. While women hold fewer than 25 per cent of board jobs at FTSE 100 companies, that’s up from 12.5 per cent in 2011, when a government commission review flagged the issue. The next step in the U.K. is to increase the number of executive directors, as most women on FTSE 100 boards hold non-executive positions.

In the U.S., where there is also little appetite for quotas, gender balance in company boardrooms is moving at an even slower pace. Fewer than 20 per cent of board seats at Standard & Poor’s 500-stock index companies are held by female directors, according to a 2014 study by Catalyst.

The European Confederation of Directors Associations wants to see more women in the boardroom but believes getting there by merit is essential.