Equal opportunities between men and women is a hot topic.  Italy is trying to make a step forward, starting in the boardroom.

On 28 June 2011, the Italian Parliament approved a law commonly known as "Legge Golfo – Mosca".  This is the first piece of legislation identifying reserved quotas for women (so-called "pink quotas") to sit on Boards of Directors of companies listed on the stock exchange.

Pink quotas are aimed at promoting the involvement of women in corporate activities and are currently set out as follows:

  • one fifth of the members of the Board of Directors for the first year; and
  • one third of the members of the Board of Directors for the following years

must be women.

The Law came into force in August 2011 but did not begin to produce effects until one year later.  Moreover, the obligations imposed by the law are applicable only at the renewal of the administrative and control Boards.  As a consequence only companies that renewed their Boards after August 2012 are due to comply.

The regulatory body for the Italian Stock Exchange (CONSOB) has a sanctioning power over companies which do not comply with pink quotas.  When CONSOB verifies that the obligations imposed by the law in terms of pink quotas are not met, it will issue a warning to the defaulting company asking for compliance within a period of up to four months.

If the company does not comply within the term assigned, CONSOB imposes a monetary penalty between €10,000 and €1,000,000 and sets a new term of three months for achievement.  In the event of repeated failure, CONSOB could also terminate the appointment of Board members.

There is much academic debate as to whether the enactment of this law was necessary or if the same results could have been reached differently – perhaps without forcing the legislator to insert a specific obligation on the issue.  Others believe that this initiative could be seen as discouraging merit.