In this article, Julie O'Neill, Associate at McDowell Purcell, explores legal issues the gender quotas presents and queries: is this the way forward?

With some of the most coveted positions in Ireland currently being held by women (such as the Chief Justice, Susan Denham, the Director of Public Prosecutions, Claire Loftus and the Attorney General, Maire Whelan), there was a lot to celebrate on International Women’s day on Saturday, 8 March 2014.

Notwithstanding this achievement, it appears that women continue to experience difficulties being appointed to boards at senior executive level. 70% of respondents in a survey carried out by the Institute of Directors in 2013 said that it was more difficult for women to become non-executive directors in Ireland.

When asked why they believe the representation of women in publicly listed companies in Ireland was at 9% in comparison to the EU average of 16%, the three reasons given were that:

1. Interlocking directorships in Ireland can mean that a small group of people populate boards and it can be difficult to break that chain;
2. There is a lack of openness and transparency in board appointments; and
3. Women do not have access to predominantly male networks that bring them to the attention of nomination committees.

One way of addressing this problem, and a concept which has, and continues, to divide many women, is the introduction of quotas which would require companies to appoint a certain number of women to their boards.

In November 2013, it was announced that proposals were being discussed at EU level to introduce legislation that would require listed companies to ensure that, by 2020, at least 40% of non-executive directors’ position are held by women. It is questionable whether such a proposal would be welcome in Ireland in circumstances where, of those surveyed by the Institute of Directors:

* 25% said that quotas are the wrong approach and that appointments should be made on merit.
* 43% said that targets rather than quotas were preferable.

Apart from the unease that quotas may represent for some people, the main difficulty with quotas is that they require an appointment to be made on the basis of gender, which, on the face of it, is discriminatory and in breach of both the current Irish and European legislation on employment equality and can lead to public relations issues. Recently, the owners of Spar on Lower Mayor Street in the IFSC apologised after the store posted a sign saying only women could apply for a job at a deli counter.

Other countries have taken some small steps towards positive discrimination for female representation on boards. In October 2013, the Companies Act 2006 (Strategic Report and Directors’ Report) Regulations 2013 was published in the UK which requires that quoted companies must produce a Strategic Report (as part of their annual reporting) that includes a breakdown showing at the end of the financial year:

* the number of persons of each sex who were directors of the company;
* the number of persons of each sex who were senior managers of the company; and
* the number of persons of each sex who were employees of the company.

While there are no plans to introduce targets or quotas at present in Ireland, it is an area that will surely continue to attract commentary in the coming years.