How are Boards composed in Europe?
The firm Russell Reynolds Associates released a comparaison of its two studies done in 2009 and in 2012 on Board composition in Europe.
The findings highlight some interesting facts on European corporate governance. The studies analyze the board composition of companies in the primary large-company stock index of 12 European countries*.
* (BEL20 (Belgium), OMX Copenhagen 20 (Denmark), CAC 40 (France), DAX 30 (Germany), MIB 30 (Italy), AEX 25 (the Netherlands), OBX 25 (Norway), WIG20 (Poland), IBEX 35 (Spain), SMI 20 OMX Stockholm 30 (Sweden), (Switzerland) and FTSE 100 (UK).)
Gender equality on Boards
Breaking the “glass ceiling” and getting more women on boards are hot topics in the field of corporate governance. In Europe, since the establishment of boardroom quotas in 2003 by Norway, requiring for both genders to have at least 40% representation on public-company boards, many other countries have voted laws setting quotas of their own. Last year, in 2012, the European Union also got involved and proposed a legislation also aiming to attain 40% of women in Board seats by 2020.
Comparing the number of women on boards in 2009 and 2012, all countries, even those with no legislation have seen an important increase in the number of female directors on large-company boards.
In countries with quotas, Norway is the only one (very) close to its target of 40%. Other countries are far behind their goals.
An interesting point is to be underlined here, all boards under such legislation will meet fierce competition to meet their deadlines in bringing women on the board, all from the same European talent pool.
Board members: nationals or foreigners?
In today’s global environment, the percentage of foreign nationality directors has increased. Some countries such as Switzerland, Denmark, Norway, Spain, Sweden and Germany have seen a very important raise.
Board directors’ age
The age of the members sitting at the board table is another key point towards a diversified board. The average age of board members has hardly changed between 2009 and 2012. Therefore, it is interesting to point out that female directors tend to be a few years younger when appointed than male directors.
Since the last 3 years, the composition of European boards has changed and the boardroom has become more diversified. It is possible that one factor impacts another and the urge to increase the number of women on boards could lead to looking beyond national borders and earlier in one’s professional career.