Germany adopts bill for mandatory quota for women on company boards

At least one woman on boards with more than three members

The introduction of this minimum requirement is the flagship measure of a new law – Zweites Führungspositionen-Gesetz – Füpog II – that seeks to increase female representation in company leadership roles (see article n°12551). It applies to firms with over 2,000 employees, which are listed on the stock exchange and subject to co-determination laws. According to the government, this requirement will apply to 66 listed companies subject to co-determination laws, 24 of which do not currently have a woman on their management board. All other large companies, which are not subject to this quota but have to set themselves numerical targets, will in future have to justify and account for their failure to appoint a woman to the board. Companies that do not set targets for the appointment of women to board roles or do not provide an explanation face sanctions.

At the same time, the Bundesrat expressed two criticisms of the bill. The representatives of the German Länder expressed regret that the Bundestag had only introduced a minimum proportion of women and not a quota for female representation on the management boards of listed companies subject to co-determination laws. 

Fixed quota in state-controlled companies. In order to set a good example, the government has introduced additional obligations for state-controlled companies. Companies in which the German government owns a majority stake will have to meet a female representation quota of 30% on their supervisory boards. This obligation will apply to companies such as Deutsche Bahn AG, Bundesdruckerei GmbH and Deutsche Flugsicherung. In addition, these companies will have to appoint at least one woman to their management board when it has two members or more.

Read the full article by Planet Labor.