Government sets female quota for board representation

On 15 March 2011, the Austrian government agreed on the implementation of female quotas for supervisory boards of state-owned companies. A quota of 25% is to be brought in by 2013 with an increase to 35% by 2018. The new regulations will affect 55 companies, including the Austrian National Bank and Austrian Railways, and the government hopes private companies will follow their lead. Employers and unions generally welcome the regulations – although for different reasons.

Background

Gabriele Heinisch-Hosek, the Federal Minister for Women and Civil Service, and Reinhold Mitterlehner, the Federal Minister of Economy, Family and Youth, agreed on the quotas after lengthy talks. Ms Heinisch-Hosek, a member of the Social Democratic Party (SPÖ), and Mr Mitterlehner of the conservative People’s Party (ÖVP) agreed on a female quota of 25% on the supervisory boards of state-owned companies until 2013, with the quota increasing to 35% by 2018. In 2008 (the most recent data available), the female presence in supervisory boards of state-owned companies was 16.1%. Ms Hosek initially demanded a female quota of 40%, while Mr Mitterlehner, who has long been against any quota system, only recently and rather surprisingly expressed a preference for a quota of 30%.

Federal state as role model

Some 55 companies will be affected. In 44 of those companies, the government holds 100% of the shares. These state-owned companies include the Austrian National Bank (ÖNB) and the Austrian Federal Railways (ÖBB). The ÖBB have already announced that they will fulfil the quota ahead of schedule as they suggest they have some catching up to do. In some of the ÖBB holding companies, however, a female quota of 25% has already been reached.

The government hopes for a ‘cultural change’ and that private companies will follow its example. In case of non-compliance with the quota, however, no sanctions are foreseen; rather, the companies need to show a willingness to voluntarily fulfil the quotas. Ms Heinisch-Hosek says yearly progress reports made by the affected companies will show whether they are achieving their quotas. If by 2018, however, the companies do not have a female quota of 35%, legislative measures are to be implemented, according to the agreement by the Council of Ministers.

Quotas for supervisory boards only

Austrian companies have two boards – a management board consisting of an executive body, and the supervisory board consisting of a controlling body. The female quota is to be implemented in supervisory boards only. According to stipulations provided for in the Labour Constitution Act (ArbVG, BGBI. 22/1974), for every two supervisory board members (shareholders) elected at a general meeting, one staff representative must be nominated. A third of the supervisory board is thus made up of employee representatives. The new quota, however, applies to the shareholders on supervisory boards only. Bernhard Achitz, General Secretary of the Austrian Trade Union Federation (ÖGB) pointed out that it cannot be implemented among employee representatives as they are works council members who have been democratically elected. Employee representatives, however, already account for more than half of all female supervisory board members in the 200 leading Austrian companies, as a study (in German, 211Kb PDF) conducted by the Viennese branch of the Chamber of Labour (AK) in 2010 indicated (AT1003019I). While the female share of all supervisory board members was at 10.3% overall, it was at 18.7% among employee representatives and only 6% among the shareholders.

Social partner reactions

Both the Federal Economic Chamber (WKÖ) and the Federation of Austrian Industry (IV) respect the implementation of the female quota and value the state as a role model in increasing gender equality. However, they are against extending this regulation to the private sector. Instead, they favour improving framework conditions like the provision of more childcare facilities, thus enabling more women to get access to executive positions. Anna Maria Hochhauser, General Secretary of WKÖ, welcomes the government’s initiative and its pioneering role; however, she feels that quotas are out of date. Veit Sorger, President of IV, appreciates the state’s effort at improving gender equality, but states that equality cannot be reached with quotas. Brigitte Ruprecht, Chair of ÖGB’s women’s group, agrees with the quota implementation and thinks that it is crucial for far-reaching change in corporate culture. She demands a female quota also on executive boards, similar to the Norwegian system (NO0306106F and NO0801029I). The AK has not yet commented on the government’s agreement. However, before it was reached, the AK demanded a female quota of 40% and a shorter transitional period of only three years instead of seven. The Chamber is known to be in favour of sanctions for those companies which do not comply. It argues that their study has shown that a voluntary commitment towards increasing the female share of leading positions has not previously been successful.

Bernadette Allinger, FORBA (Working Life Research Centre)

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