Large listed companies must fill at least 30% of the supervisory board seats with female non-executive directors, under new law
Women are about to flood the corporate world in Germany.
Chancellor Angela Merkel’s government adopted a bill on Thursday that will require large listed companies to fill at least 30% of the supervisory board seats with female non-executive directors. The bill will also force thousands of large and mid-size companies to employ more women as managers.
Despite being arguably the most powerful woman in the world, Merkel has so far been unable to convince Germany’s male-dominated business world to voluntarily diversify. Only one-third of the 30 companies in Germany’s DAX stock index would currently meet the 30% quota suggested in the bill. Women’s representation on executive boards is low compared to other European countries like Norway, France and Sweden, according to the Wall Street Journal.
“I am convinced that we will set in motion a cultural change and that this law is a historic milestone for more equality between women and men in this country,” Manuela Schwesig, family minister and main sponsor of the bill, said at a news conference.
The new law will require 108 publicly-traded companies to place women in over 170 supervisory board seats. And an additional 3,500 companies with over 500 employees each will have to boost the number of women in management positions within the next two years.
But businesses are unenthused to meet these targets. A quota “ignores that professional qualification must be the decisive criterion for filling a supervisory board position,” Germany’s employer and industry federations said in a joint statement.