Business Secretary Vince Cable will face questions from a House of Lords committee later today about the UK’s response to EU plans to introduce a 40% quota for the number of women on company boards, amid concerns that these could undermine UK equality rules
Cable is due in front of the House of Lords EU Sub Committee on the internal market, infrastructure and employment on the afternoon of 7 July.
The committee is examining EU proposals to impose a minimum number of women on boards, with a target of 40% for non-executive boards or 33% of all boards by 2020. These are currently being negotiated in Brussels and are expected to be a priority when the new European parliamentary session this autumn.
Likely questions for the business secretary include whether or not the UK can reach the proposed targets by the 2020 deadline.
Cable has previously stated that quotas are a ‘real possibility’ if the UK government’s own target of 25% for women on boards by 2015 is not met, and the committee will ask him whether this is still an option.
He will also be asked to comment on whether the EU target of 40% is appropriate, and whether the government intends to invoke an exemption allowing member states to continue promoting equality through national measures if they can show that they will reach the relevant target by 2020.
However, the quota proposals are controversial across Europe and they are not yet on the statute books. The process for debating them and getting them into law has got very extended because of the recent EU parliamentary elections and change of parliament.
So far, the European parliament has indicated it is in favour of legislation for quotas for women on boards and has passed a vote in favour. But it needs to get this legislation approved through the Council of Ministers, and if a bloc of larger nations is opposed to the idea they can prevent it becoming law. At the moment there is a some horse-trading over how it would work, but it is clear that the European parliament will be trying to get this on the rule books.
The Lords committee has indicated its concerns that setting quotas is a form of positive discrimination, which runs counter to the UK legislation in the Equality Act 2010. It will want to explore whether the government would consider challenging the proposal in the European Court of Justice (ECJ).
A committee report on Women on Boards issued in November 2012 cautioned against the introduction of quotas at EU level on the grounds as they would ‘risk setting back voluntary efforts without achieving broader gains'.
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