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Legislating Gender Equality: A possible success?

February 17, 2010
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            Following up on an earlier post, I found another article in the same NY Times series:  The Female Factor. “Getting Women into the Boardroom, by Law” evaluates the implementation of a 2003 Norwegian law mandating that at least 40% of all company board members be women.  Although Norwegian society is notoriously egalitarian (80% of women work outside the home and half of all government ministers are currently women), this was still a hotly contended law that continues to pose questions for the role of business in creating a more equal society.

            At the time, women held less than 7% of private-sector board seats in the country; by the 2008 deadline, the 40% quota was, however, met.  Compare 40% female representation in Norwegian boardrooms to the percentage in the top 300 companies in the EU (9.7%, up only 1.7% since the Norwegian law passed) and the percentage of female board members serving the US Fortune 500 (approximately 15%).  Proponents of the law argue that this increase in representation would have taken 200 years given the percentage growth rates in Norway.

            The opposition has highlighted the fact that such laws essentially force companies to promote less experienced candidates in order to meet quotas.  On average, women promoted to these boards are seven years younger than the men they replace and, owing to their inexperience, may be more susceptible to manipulation.  On the other hand, these women are also more likely to have a MBA compared to the men they replace.  Nonetheless, female representation on executive committees, where real corporate power lies, remains disproportionately low.

            Some of the people interviewed point to the positive effects of female board members, namely how diversity (both in gender and age) in such settings can lead to greater innovation, competence and leadership strategies.  When the hiring pool is expanded to include women, pressure is put on mediocre male board members to prepare and possibly perform better than they would have otherwise.

            There are, however, other ways to increase women’s representation in the upper echelons of the workforce.  Shorter maternity leaves and higher incidence of paternity leaves can help distribute the career-burden that building a family can entail (as another report in this series from Germany highlighted).

            Affirmative action was and continues to be a large issue in the United States, but taken with the Norwegian example, we can see that there is no panacea for gender inequality.  The number of men and women in positions of corporate power is dependent on cultural, economic and, of course, political situations.  The question is:  are political reforms and quotas the best way to effect change?

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