The summer of 2014 in France marks progress for gender equality, in particular concerning gender balance on corporate boards of directors.
The French Parliament adopted July 23, 2014 the bill referred as « real equality between women and men » which regards amongst other issues, the question of women on boards. This law includes a series of measures to address inequalities wherever they occur. This concerns professional equality (reform on parental leave to improve shared parenting, reinforced sanctions for discriminatory layoffs, equal pay…), ensure child support for single-parent families, fight against violence against women, reduce gender stereotypes and widespread parity in all spheres of society: politics, corporate boards, government bodies (professional orders, consular chambers…) and in public institutions of cultural cooperation.
Najat Vallaud Belkacem, the Minister of Women’s Rights, is behind this initiative and she says that all the decrees will be issued before the end of the year.
Breaking the glass ceiling
This new law strives for parity in management and corporate governance and intends to accelerate the feminization of these positions. It confirms the application of the Zimmermann Cope law (2011) which requires companies quoted on the stock exchange making at least 50 million euros in turnover and employing more than 500 workers to have 40% of women directors on their boards by 2017
Now with the law on real equality, this obligation is extended to businesses with 250 to 499 employees and making at least 50 million euros in turnover. This goal is to be achieved in 2020.
Since the introduction of quotas in 2011, the percentage of women serving on boards of directors or supervisory boards of CAC 40 companies rose by 7.4 points.
In 5 years, we note that the proportion of women in these bodies has tripled.
On June 1st 2014, 30.3% of directors on boards of directors and supervisory boards of CAC 40 companies were women according to the Ethics and Boards Cabinet.
Between 2010 and 2013, the share of women in the management and governance bodies of large companies has increased in 22 of the 28 members of the European Union. The largest increase was recorded in France with 17.4 points. The SBF 120 companies are experiencing a similar increase of the proportion of women on their boards of directors with an increase of 3.1 points to reach 28.8%.
Despite the progress of the share of women on boards of directors, there is still some way to go in executive committees where there are only 10.3% of women in CAC 40 companies and 12.1% in SBF 120 companies (an increase of 0.3 and 0.1 points between September 2013 and June 2014).
To speed up the movement in France, 27 companies have made commitments through signing agreements with the Ministry on the feminization of management positions, including those in executive committees. In addition, 10 new companies will soon join this process.
More and more women are opening the boardroom doors and they must because boards need them! The culture of the « old boys club » is over, the presence of women in corporate governance has become a necessity.
Numerous studies have shown a correlation between the presence of women on boards and improved business results. Indeed, diversity in governance and management allows diverse opinions and experiences to meet. It also allows to share different approaches or solutions to challenges, issues or while making decisions. In addition, women directors are more likely to make decisions that take into account the interests of all stakeholders, using cooperation and collaboration to reach an informed and fair decision. Equal representation enhances the image and reputation of the company and while enjoying new knowledge or viewpoints, governance will be improved, therefore leading to better business performance.
Source graphic Ethics & Boards
For more information, visit the website of the Minister of Women’s Rights
