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Lack of women in top jobs to cause 'problems' for EU economy

  • Viviane Reding - EU companies should make more use of this "untapped talent" (Photo: consilium.europa.eu)

The EU's internal market will suffer if companies do not put more women on their boards, the EU's gender equality commissioner Viviane Reding said Tuesday (11 July).

Reding made the claim while standing alongside Chantal Gaemperle, a board member at French luxury label LVMH, who had just signed an EU-sponsored pledge to increase the number of women in the company.

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The commissioner said that come March next year she will look to see whether companies have made a "clear, precise and measurable evolution" towards greater gender balance within their walls.

"If yes, there will be no need for European legislation. If no, we will have a problem with the internal market," said the commissioner explaining that major companies who work across the EU will be confronted with different national laws on women quotas.

Reding's thinking is that if there is a public procurement tender in Spain, for example, Spanish companies who already have to oblige by national quota laws will have an immediate advantage over a German company, which does not.

France, Spain, Belgium, the Netherlands and Italy all have national rules concerning the representation of women in business.

The commissioner, who wants to boost female boardroom positions to 30 percent by 2015 and to 40 percent by 2020, said she is "completely supported" by internal market commissioner Michel Barnier.

Currently women make up 10 percent of directors and 3 percent of chief executive officers in the EU's largest companies, with the number of women on corporate boards increasing by around half a percentage point per year.

Although Reding has been increasingly vocal about her campaign, to date only seven companies have signed up to the public pledge, up and running since March.

And while LVMH is the largest company to have done so, the move represents something of a hollow victory for Reding as a French law, in place since early 2011, requires that the company's board be made up of 40 percent women by 2017.

Reding, in her third term as EU commissioner, has experience with these types of uphill battles. She took on the mobile phone companies in her previous commission life using similar tactics. When mobile phone companies ignored her, she regulated to bring prices down.

She is supported by the EU parliament, which earlier this month said Brussels should make such quotas mandatory. An EU law in an area dealing with employment and social policy is likely to be controversial among member states, however.

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