Germany: Quota for Female Board Participation Will Change World of Work, Family Minister Says

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By Andrea Barbara Schuessler

Feb. 4—Legislation requiring that 30 percent of supervisory board replacements in 108 companies be women beginning in 2016 will initiate a cultural change in the working world, Germany's Family Minister Manuela Schwesig said at the first Bundestag reading of the bill. The targeted companies are those that are both listed on the stock exchange and partially managed by employees.

According to a report released last month by the German Institute for Economic Research, 18 percent of supervisory board members of Germany's largest 200 companies are female and only 5 percent of corporate executives.

Companies with mixed-gender teams are more successful, Schwesig told the Bundestag, noting research by a Swiss bank showing that stock prices of companies with women on supervisory boards demonstrated 26 percent better performance from 2005 to 2011.

A ‘Milestone'

Christian Lange, parliamentary state secretary at the Justice Ministry, agreed with Schwesig that the introduction of the quota would lead to a change in culture, adding that it would also help address Germany's skills shortage and provide the means to resolve the decades-old controversy over enforcement of Article 3 of Germany's Constitution, which states that “men and women shall have equal rights [and] the state shall promote the actual implementation of equal rights for women and men and take steps to eliminate disadvantages that now exist.”

Bundestag member for the Christian Democratic Union Elisabeth Winkelmeier-Becker called the legislation a “milestone” comparable to the introduction of women's suffrage.

Following passage by the Bundestag, the legislation must be considered by the Bundesrat, the upper house of parliament, and signed into law by Federal President Joachim Gauck.

To contact the reporter on this story: Andrea Barbara Schuessler in Berlin at correspondents@bna.com

To contact the editor responsible for this story: Rick Vollmar at rvollmar@bna.com

Full text of the draft legislation is available at http://dip21.bundestag.de/dip21/btd/18/037/1803784.pdf, the Institute for Economic Research study at http://www.diw.de/documents/publikationen/73/diw_01.c.495356.de/15-4-1.pdf, both in German.

For more information on German HR law and regulation, see the Germany primer.