Netherlands passes law to get more women into top business roles
Large companies may be required to appoint more women to their leadership starting in January. The Senate approved a bill to maintain a quota for the number of women at the top of the business world. It was passed by the Tweede Kamer, the lower house of Parliament, in February without the support of Prime Minister Mark Rutte's VVD party. That changed on Tuesday with the Senate factions of the VVD siding with coalition partners CDA and D66, and opposition parties GroenLinks, PvdA, SP and PvdD, in support of the measure.
Listed companies will soon have to maintain a supervisory board with women making up at least one-third of membership, and men making up at least one-third of membership. The goal for the upcoming years is that one woman is appointed for every man who leaves until the quota is met.
Large public and private limited companies are required to set targets to balance the gender ratio in the company's leadership. They must report updates on this issue annually. This concerns approximately five thousand companies that are not listed on the stock exchange.
The outgoing Cabinet said the law is "necessary to nudge the business community forward to really work on diversity" and "to get rid of the old appointment culture we now know." It is a good thing that women are being given equal opportunities and, moreover, diversity at the top ensures better business operations, said the current coalition Cabinet. The bill was based on the advice from the Social and Economic Council (SER). The need for such a law has been debated for years.
The annual Dutch Female Board Index recently revealed that more than two-thirds of the dozens of Dutch listed companies already meet the one-third women's quota. The smaller funds in particular still have to appoint women in order to catch up to the rest
The law will be evaluated after five years, and both provisions will expire after eight years. Caretaker ministers Sander Dekker (Legal Protection) and Ingrid van Engelshoven (Education, Culture and Science) aim to have the law take effect on January 1, 2022.
Reporting by ANP and NL Times