Politics

German minister calls for female quota in boardrooms, end to ‘boys’ club’

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Via Deutsche Welle

Germany’s family minister wants to require large German enterprises to have women on their directory boards, with legislation potentially coming as soon as this year, German broadcaster SWR reported on Monday.

In an interview, the broadcaster asked family and women’s affairs minister Franziska Giffey, of Germany’s center-left Social Democrats, about the planned legislation, which would require publicly traded companies with more than 2,000 employees and at least four executive board positions to give at least one seat to a woman. 

A draft of a bill is already before the chancellery, Giffey said. Now it must find parliamentary support. The minister hopes for such a law to go into effect sometime this year.

“It is absolutely appropriate and in line with the times we live in,” she said. 

‘Not a matter of competence’

Since 2016, large companies have  been required to have women make up at least 30% of their advisory boards. 

But a study by the German Institute for Economic Research has shown that this requirement has had little effect on the number of women with positions on the board of directors. 

While the figure went up in 2019, women still only account for 10% of executive positions in Germany, Giffey said. 

Franziska Giffey SPD (picture-alliance/dpa/W. Kumm)

Family Minister Franziska Giffey

Read more: Germany — where female board members earn more than men

German enterprises are also already required to set a target for the share of female managers on its board of directors. 70% of companies have set that target to zero, Giffey said.

“That won’t do,” she said. “Boys-only clubs are no longer appropriate nowadays and only 7% of women in executive positions is much too little. It can’t be a matter of competence. There are structural issues at play.”

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As a next step, lawmakers will discuss whether companies should be punished for setting their goals to zero unnecessarily.

Legally, it is more difficult to require a company to include women on its executive board than its advisory board.

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