1 week Ago By The Sofia Globe staff
The European Union’s entered into application at the end of 2024, aiming for a more balanced gender representation on the boards of listed companies across all EU member states, the European Commission (EC) said on January 3. The directive sets a target for EU large listed companies of 40 per cent of the underrepresented sex among their non-executive directors and 33 per cent among all directors. The deadline for the transposition by EU countries was December 28 2024, and companies must meet the targets by June 30 2026.
The share of women on corporate boards is 34 per cent on average in the EU. “Since 2010, the representation of women in corporate boards has improved in most EU member states, but the extent of progress varies considerably and in some member states it is stagnating,” the EC said. For example, in 2024, women accounted for 39.
6 per cent of the board members of the largest listed companies in countries with binding gender quotas, compared to 33.8 per cent in countries with soft measures, and just 17 per cent in countries that have taken no action at all, the Commission said. By now, member states must have transposed the directive’s rules into their national legislation.
These rules include specific binding measures for the selection procedure of board directors, with transparent and gender neutral criteria. A preference rule for the candidate of the underrepresented sex – in case of equally qualified candidates of both sexes. The disclosure of qualification criteria if requested by an unsuccessful candidate.
Individual commitments from listed companies to reach gender balance among executive directors. Reporting on the composition of boards and obstacles to meet the target of the directive, where applicable, and actions taken to overcome these. Effective, proportionate, and dissuasive penalties for companies failing to comply with transparent selection and reporting obligations.
Penalties are defined by member states, and can include fines and nullity or annulment of the contested directors’ appointment if needed. The directive also requires EU member states to publish a list of companies that reached the gender balance targets as well as designate one or more bodies for the promotion, analysis, monitoring and support of gender balance on boards. The Commission will check the notifications of member states of their transposition measures, and whether these measures correctly transpose the provisions of the Directive.
The Commission can launch against member states that fail to notify transposition, or to correctly transpose, the directive. ( ) :.
