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Can Quotas Work?

posted 7 Oct 2011, 12:36 by Ines Wichert   [ updated 7 Oct 2011, 12:41 ]

Including women at all levels of organisational life makes sense: women bring different skills and a fresh perspective to decision-making, foster innovation and are good for an organisation’s image. Furthermore, organisations with the most gender-diverse management and board teams have better financial results (e.g. Catalyst, The Bottom Line, 2007).

In 2003, Norway was the first country to enact a quota law that stipulates that 40% of board positions in all publicly listed and state owned companies have to be held by women. Despite the initial outcry, there now seems to be agreement about the effectiveness of the law to increase the number of women on boards. As a result, other countries such as Spain, France, Iceland and Canada are following Norway’s example and introducing quotas for women on boards.

After this success, all eyes have turned to executive teams. However, statistics from Norway are still as disappointing as they are elsewhere. Only about 6% of senior management roles in private companies are held by women. These results emphasise the importance of strengthening current efforts to increase women’s representation at executive level. Skills training, networking opportunities and mentoring schemes are often mentioned as effective interventions. Not surprisingly, much the same applies to increasing women’s representation senior executive level. The problem is not a lack of knowing what works but rather an unwillingness to make gender diversity an organisational priority (McKinsey - Women Matter, 2009). Policies and initiatives to redress the gender imbalance at senior levels require active CEO sponsorship, close monitoring for effectiveness and anchoring in performance metrics.

Taken from Can Quotas Work?, co-written with Elin Hurvenes, Chair of the Professional Boards Forum, Norway, and published in The HRDirector, December 2010, Issue 74.

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