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EC: Women rare on corporate boards

A legislative proposal put forward by the European Commission in 2012 was designed to increase the number of women on the non-executive director boards of European-based companies to 40% by 2020.

The Commission recommended that the legislation should stipulate that companies with more than 250 employees and revenue in excess of €50 million would be required to report annually on the gender composition of their boards. Failing to meet the mandatory quotas would result in fines or the barring of companies from state aid and contracts.

This regulation would only apply to approximately 20 companies registered in Hungary; it was estimated that, even with the quotas in place, it would take companies approximately 40 years to reach the proposed level of women in non-executive director boards.

Hungary refused to participate in the measure.

According to a report published by the European Commission in 2014, “gender gaps in employment and decision-making have narrowed in recent years, but women still account for less than a quarter of company board members, despite representing almost half of the employed workforce (46%).”

Women face three types of disadvantage on the labor market in Europe according to the 2014 EC report: being paid less per hour; working fewer hours in paid jobs; and being under-represented in paid jobs. The result is that women earn much less than men on average, and the total earnings gap reached 37% in 2010.

Data compiled by the European Commission in 2012 and 2013 states: “Women have only a near zero chance to obtain board member positions in the largest and most influential companies quoted on the Hungarian stock exchange.”