Prof. Raphael Koch

Board Gender Quotas in Germany and the EU: An Appropriate Way of Equalisation of Women and Men?

The equalisation of men and women is currently one of the most discussed topics in corporate law. In addition to the social debate, legislative intentions in Germany and the European Union are becoming more and more concrete. In November 2013 the European Parliament voted in favor of a directive drafted by the European Commission providing for reserving at least 40% of the seats in boards of listed companies for women by 2020. Also, in Germany the new coalition government of the CDU, CSU and SPD agreed upon the implementation of legal rules concerning female quotas in managing boards. By the beginning 2016 this quota will obligate listed companies to appoint at least 30% women to their boards. The first guidelines for the legislative procedure have been worked out and published in April 2014.

The general problem concerning gender quotas is equalisation of men and women being primarily a sociopolitical objective. The implementation of female quotas therefore raises the question if interference with private business management can be justified by such sociopolitical reasons, especially as gender quotas can be legitimated in different ways: On the one hand, they can be regarded as an act of Corporate Governance, on the other hand it is possible to categorise the topic as a matter of Corporate Social Responsibility. The recent development in Germany and in the EU is also an example for the conflicting national and international law: Should national states be able to implement their own rules to reduce gender discrimination? Or is there – due to globalisation and the internationalisation of the law a need for international and transnational regulation?

This paper will discuss the benefits and disadvantages of gender quotas in managing boards and discuss recent legislation in Germany and in the EU. It will analyse different ways of incorporating the equalisation of men and women into corporate and company law. Furthermore, predictions will be made where current developments are leading to.

(April 2014)