The European Parliament on Tuesday approved landmark rules to boost gender equality by increasing the number of women on the boards of big companies in the EU.
"By July 2026, all big publicly listed companies in the EU will have to take measures to increase women's presence at their helm," a statement by the EU's legislative body said.
The adaptation of "Women on Boards" directive requires big firms to ensure at least 40% of non-executive director posts, or 33% of all director posts on publicly listed firms, are occupied by women by June 2026.
"Merit must remain the key criterion in selection procedures, which should be transparent," the statement said, adding that a judicial body could also annul the board of directors if it breaches the new directives.
Small and medium-sized enterprises with fewer than 250 employees will be excluded from the regulations.
The European Commission first presented its proposal in 2012, but the file was blocked in the European Council for almost a decade until negotiators struck a deal in June.
In 2021, only 30.6% of board members in the EU's largest publicly listed firms were women. Even with rises in representation on boards, in 2022 fewer than 1 in 10 of the largest listed companies in EU countries have a woman chair or CEO.
"After 10 years since the proposal, we will now have an EU law for gender equality on company boards," said EU Commission President Ursula von der Leyen. "The glass ceiling preventing women from accessing top positions in companies has been shattered. This is a truly historic and moving moment."
