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Legal push lets women into EU boardrooms January 29, 2010

Posted by reader111 in Women Rights.
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Nicola Clark, NYT News Service, 29 January 2010
OSLO: Arni Hole remembers the shock wave that went through Norway’s business community in 2002 when the country’s trade and industry minister, Ansgar Gabrielsen, proposed a law requiring that 40% of all company board members be women.

“There were, literally, screams,” said Hole, director general of the equality ministry. “It was a real shock treatment.” Even in this staunchly egalitarian society — 80% of Norwegian women work outside the home, and half the current government’s ministers are female — the idea seemed radical, if not for its goal, then for the sheer magnitude of change it would require.

Back then, Norwegian women held 7% of private-sector board seats; just under 5% of chief executives were women. After months of heated debate, the measure was approved by a significant majority in Parliament, giving state-owned companies until 2006 to comply and publicly listed companies until 2008.

Eight years on, share of female directors at roughly 400 companies affected is above 40%, while women fill over a quarter of the board seats at the 65 largest privately held companies. To many feminists, this is the boldest move anywhere to breach one of the most durable barriers to gender equality.

Indeed, the world has noticed: Spain and the Netherlands have passed similar laws, with a 2015 deadline for compliance. The French senate will soon debate a bill phasing in a female quota by 2016, after the National Assembly approved the measure last week. Belgium, Britain, Germany and Sweden are the countries considering legislation.

Still, questions remain about whether boardroom quotas can address other hurdles to female advancement.

A 2007 McKinsey study of the largest European companies found that those with at least three women on their executive committees significantly outperformed their sector in terms of average return on equity by about 10%; operating profit was nearly twice as high.

The study stopped short of attributing this performance to a “critical mass” of women but found that companies with pronounced gender diversity at the top tended to rank highly in terms of management quality and organization.

But economists say link between performance and women on boards is less clear. The boards primarily monitor and advise executives and top managers, who are still mostly men.