The European Commission has proposed legislation aimed at realising a 40% female membership of non-executive board membership in publicly listed companies. Across the EU, approximately 86.5% of board members are male with just 13.5% being female. In Ireland, 6.8% of executive and 9.4% of non-executive board members are female.
The proposed directive sets a minimum target of 40% for female non-executive members by 2020 for the boards of publicly listed companies in Europe, or 2018 for listed public undertakings. Qualification and merit remain the key criteria for the appointment of board members and the directive contains minimum harmonisation of corporate governance requirements due to the objective qualifications criteria which are to apply to appointments. Pursuant to European Court of Justice case law on positive action, preference is to be given to equally qualified members of the under-represented gender, unless an objective assessment taking into account all criteria specific to the individual candidates tilts the balance in favour of the candidate of the opposite sex.
Member States who already have an effective system in place relating to the promotion of female board membership will be allowed to retain such system, provided it is at least equally as efficient as the system proposed by the Commission in the pursuance of the 40% female membership target.
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