30% Club Underlines Belief That Quotas Are Harmful To Ongoing Gender Debate

October 23rd 2012, London

The 30% Club hopes that the European Commission will not vote for quotas when the Draft EU Directive to impose a 40 percent quota on listed company boards, championed by Viviane Reding, is put to the EU Commissioners later today. The 30% Club reaffirms its position that voluntary change is the right approach to achieving a balanced board, that quotas can actually be harmful to the development of diversity and are not the best way forward. Citing the UK as an example where a merit-led approach to gender diversity on company boards does work, the 30% Club notes that while there are still too few executive women on boards, the overall pace of change, especially in the FTSE-100, is striking. Since 1 March this year, 48% of FTSE-100 non executive director appointments have gone to women, which equates to 30 out of 62. Women now make up 17.3% of FTSE-100 boards, up from 12.5% only two years ago. A much referenced example for quotas has been Norway, where there has been a big shift in the gender balance in the boardroom since the imposition of mandatory quotas. However, just 8% of top management roles in Norwegian publicly listed companies are held by women and just 3% of Norwegian CEOs are women, almost the exact same percentage as in the US S&P 500, where quotas are an alien concept. The 30% Club believes that there is an alternative to quotas; a voluntary approach that will have a positive impact at all levels within an organisation. Commenting on the draft directive, Helena Morrissey CBE, CEO of Newton Investment Management and Founder of the 30% Club said: “The 30% Club is vehemently anti-quotas to force change; they are a form of discrimination, designed to create the illusion of progress but they don’t work. Instead, we are interested in a sustainable increase in the pipeline, which will take longer but deliver real benefits to businesses that currently lose so much female talent. “Many companies are recognising that the issue of better gender balance is an important business issue rather than a ‘women’s issue’. Chairmen representing 60 of the UK’s largest most successful companies are supportive of the 30% Club’s goal of at least 30% female representation on UK boards, because they have seen the positive impact women have made to the effectiveness of their boards. If companies are going to go beyond box-ticking they must own the debate, and we continue to encourage a voluntary approach to sustained change in business culture in this country. “The rate of change over the past two years, and the rate of acceleration in terms of non-executive appointments, shows that a voluntary approach to gender diversity does work. We encourage MEPs to vote against the directive, help industry to build on the successes of the past two years and create a strong new and sustainable business culture that enables more women to progress and more companies to retain valuable talent of both genders.”