Lord Davies has published the second annual progress report on his 2011 Women on Boards Review, revealing an increase in the number of women in UK boardrooms. As of last month, women accounted for 17.3% of FTSE 100 and 13.2% of FTSE 250 board directors. However, the 2011 Review set a target for FTSE 100 companies of a minimum of 25% female representation on boards by 2015 and the Business Secretary Vince Cable has now warned that companies face the "real possibility of quotas" if the target is missed.

There is also the European angle to consider – at the end of last year the European Commission announced proposals to increase the number of women on the boards of listed companies in Europe. A new Directive will set a target of 40% female representation on non-executive board member positions in larger companies listed on stock exchanges, to be achieved by 2020. Companies failing to meet this target would have to take positive action by giving preference in appointments to an equally qualified woman, unless an objective assessment tilts the balance in favour of a male candidate. Listed companies will also be obliged to have a "flexi-quota" – a self-regulated target for executive representation on boards, also to be met by 2020.

Member States will only be able to rely on their own systems as an alternative if they are "as efficient" as the proposed Directive in achieving the 40% target.