The European Commission moved one step closer on Monday to forcing companies to increase the number of women on their boards with a consultation on imposed quotas that could prove divisive among some member states and industry bodies.
EU Justice Commissioner Viviane Reding has kick-started a three-month debate that could result in legislative action, a year after she called on companies to take voluntary steps to increase the number of women on boards to 30 percent by 2015 and 40 percent by 2020.
Personally, I am not a great fan of quotas, said Reding. However, I like the results they bring.
At present, only 13.7 percent of board members at Europe's large listed firms are women.
With only 24 companies across Europe signing up to the voluntary pledge in the past year, at the current rate of progress it would take more than 40 years to reach its target, the Commission said, explaining the need for tougher action.
The Commission will call on national governments, companies and industry bodies to comment on what measures could be adopted to redress the balance, with any decision on further action to be taken later in the year.
Any EU-wide legislation would require the backing of governments representing two-thirds of the bloc's population which could prove the biggest stumbling block.
Most national employment ministers spoke out against legislation when Reding addressed them at a meeting of the EU's employment and social affairs council on February 17.
Only those countries that already have quotas - Austria, Belgium and Finland - signaled their backing.
Many member states prefer action at a national level. Belgium, France, Italy, the Netherlands and Spain have adopted legislation that introduces gender quotas for company boards.
In the UK, Prime Minister David Cameron said that while he did not favor quotas, they might have to be imposed if companies could not tackle the gender gap on their own.
The business community has also voiced concerns over any action to force measures on companies.
The European Round Table of Industrialists, a forum for the chairmen and chief executives of major multinational companies, has warned that big divergences among sectors and national traditions meant any measures should remain voluntary.
But 75 percent of European citizens are in favor of legislation to address gender imbalances in the boardroom, according to the latest Eurobarometer survey published on Monday.
Gender-balanced companies have a 56 percent higher operating profit when compared to male-only companies, a report by McKinsey shows.
I believe it is high time that Europe breaks the glass ceiling that continues to bar female talent from getting to the top in Europe's listed companies, said Reding.
(Reporting By Anjuli Davies; Editing by Mark Potter)