How many women are on your board of directors? Decade after decade studies have shown a direct connection between gender parity and a company’s bottom line. Having a more diverse workforce increases productivity, enhances collaboration and greatly affects a company’s overall employee wellbeing, preventing them from leaving after a short tenure. Despite this fact, the number of women in leadership positions keeps dwindling. Between March and August 2023, the percentage of women leading Fortune 500 companies has gone down from 10% to 5.8%. In the Netherlands, home to 9 global Fortune 500 companies, only one of these companies is led by a woman CEO.
The progress seemed promising for a few years. Until 2020, the number of female directors in the 88 Dutch listed companies was growing steadily. However, the rise of women in leadership positions is stalling. At the beginning of this year, the female board index introduced a legal quota of a minimum of 33% women in supervisory director roles for all Dutch listed companies. While the companies have no problem meeting the requirement, the number of women on boards has remained at 15% for the second year in a row.
Though supervisory directors are part-time roles, they are responsible for appointing the board of directors. The hope was that more women supervisory directors would help bring gender balance to the boards of directors. Unfortunately, that has not been the case. In fact, the number of women seems to keep going down. While in 2020, 28 percent of newly appointed directors were women, this year that has dropped to 13 percent.
It gets worse. The big listed companies also act as industry trend setters. Out of the 88 Dutch companies, 66 do not have a single woman on the board of directors. Big known names such Philips, Akzo Nobel, ASML and Just Eat Takeaway failed to appoint a woman to the board last year. The authorities had hoped for a flywheel effect, but it is clear that tougher laws and stronger measures are needed. Marguerite Soeteman-Reijnen, the chairman of the advisory board of the SER Top Women Foundation, is not surprised by the lack of more female directors: ‘We have seen the same kind of approach fail in Germany and France. Additional measures were later taken there.’ When the quota was introduced, Soeteman-Reijnen had already asked the quota to be applicable to boards of directors and not just supervisory directors, but she received no support.
It is rather disgraceful that while gender equality is one of the UN SDGs, companies still need threats of law and penalties to do the right thing, even if it will only benefit them! The discrimination is not only limited to top positions, but has trickled down the system. While many people believe the Netherlands to be a great place to work, there is still an appalling 13% pay gap between men and women. While Europe in general has the highest gender parity of all world regions, the Netherlands doesn’t even make the top 10. Both our neighbors Germany and Belgium are in the top 10, with Iceland in first place.
As companies struggle to capture young talent, they might want to keep in mind that today’s generation doesn’t want to work in organizations where topics like diversity and inclusion and gender equality are not at front and center. By ignoring women for key leadership positions, companies are also risking missing out on more than half of the talent pool – women make up over 50% of the workforce and while some companies might want to bury their head in the sand and stick to their biases, their competition may not.
All in all, it’s not rocket science that having women in leadership position will help everyone – employees, companies, and even the economy.
Written by Priyanka Sharma