Hedwige, thank you very much for accepting the invitation to ESG 12on12 interview! It is an honour to speak to you. Recently, you have achieved an enormous success – you have helped to bring the Women on Boards Directive into life. The Directive requires the EU member countries to establish quotas for a set percentage of women in top positions. Why in the XXI century we need law that guarantees equality between men and women in the corporate world?

Thank you so much for inviting me. I am so pleased to be able to share my views with you.

As President Ursula von der Leyen said in her speech in January, when change does not come naturally, regulation is needed. We see that the number of Women on Boards varies hugely between countries. In France we have over 45% now, in Estonia a little over 8%. With this directive we will see change across Europe, in all industries.

In 2012 a Board Directive setting targets for a minimum 40% of men and women on boards for stock listed companies was proposed. The Directive was approved by the European Commission and the European Parliament. But it was blocked by the European Council. What was the reason behind silencing such an important Directive?

It is a good question, and the answer might surprise you. Some countries like Sweden were opposed, not because they are against women. On the contrary, they have one of the highest representation of women in Corporate Boards. For them it was a matter of principle, corporates should have the right to decide themselves who to appoint, regulation should not interfere. Other countries like the Netherlands were long convinced that change would come automatically, over time, that no regulation was needed. In Germany, there was strong opposition from the corporate world to quota. So many reasons, but we were able to convince countries to change their mind. And the Directive got the support from all countries, with only 2 against (Poland and Sweden).

How has the situation changed over the decade? Have we lost so many years or maybe diversity on boards has increased over the years?

Yes, luckily diversity has increased, from nearly 20 to 30% Women on Boards now on average. And we have 4,5 years now to move from 30 to 40%. This objective needs to be met by 30 June 2026.

What arguments have persuaded the EU to return to discussion on fixed quotas? What are the key points of the Women in Boards Directive? What aspects of C-level and board level the Directive touches?

One of the main arguments was precisely that the Directive does no longer speak about quotas but about objectives. Each company will have to put a target for the number of women and will have to put an action plan in place and publish on the progress made. The other argument that helped is the obvious progress that was seen in countries that took measures (hard quota help most, but even softer quota can make a difference). With the Directive, we will have a strong framework in 27 countries. We are very proud, as European Women on Boards, to have contributed to the agreement on this text. We worked incredibly hard, day and night, for months.

The Directors requires the EU countries to choose between 40% of women as non-executive directive (supervisory board members) or 33% of women at boards of boards of directors (management and supervisory board members). Why was this choice given? The role of NEDs is different than EDs. Is one choice better than the other? What aspects should politicians take into account while making the choice?

That was the result of a long debate. Situations can vary between countries. Corporate governance is not the same everywhere. In the Anglo-Saxon world, it is common to have only one Board, with Executive and non-Executive Directors. On the continent, you often have a Board of Directors and an Executive Committee. In the Netherlands and Germany, you can even have 3 decision layers. So, depending on the country, it can make sense to have an objective for the Board only, or for the Board and the Executive Committee combined. Both systems can work and be meaningful.

Is the Directive certain to come into force or is there still risk that it will be shelved like a decade ago?

No, we have a political agreement, the text has received the blessing from all parties. The text is rubber stamped with final legal checks, but we expect that it will be published soon.

The EU consists of countries with a varied level of women in top positions. E.g. France is one of the leaders in board gender diversity with quotas in place for years. Poland is on the opposite side of the road with limited support for diversity – we have Best Practice for Listed Companies 2021 with two principles defining a gender diverse management and supervisory board as one with underrepresented gender having at least 30% of the seats. How do you see the Directive being implemented in so many countries with different diversity background?

It is not the first time that a Directive is voted. So, countries are used to that. There is a strict procedure and timetable foreseen in the Directive that will help countries implement the principles. The big advantage of working with a Directive, is that countries can customise the regulation, so that it better fits with the legal framework and corporate governance in place in their country. We have promised the European Commission that we, as European Women on Boards, would help implementing the Directive.

Running diversity campaigns at 30% Club Poland we often hear that top positions should be achieved based on competence and that there simply are not enough skilled and experienced female management and supervisory board members to fill in the positions. What is your stance on this?

Top positions should be based on competence. The Directive is clearly taking this stance. That’s why companies are invited to be clearer in the profile of the Board Directors they are looking for, the competencies that are needed. They will have to make the recruitment process more transparent and explain why they have chosen the one candidate and not the other. So, the goal is to have the best directors at the helm of European Companies. It is strange though, that when you have a male only Board, nobody asks the question whether they are really the best possible candidate.

One element is introducing the Directive into the member countries’ law, the other is executing it. What advice would you give to boards of directors to start making their senior talent pool more diverse one? What solutions prove successful, and which should be avoided?

Diversity is not a matter of luck or coincidence. It starts with a Diversity and Inclusion Culture. But that takes time. Stock-listed companies very often use executive search firms to propose or assess candidates. A good start can be to only work with search firms that have good credentials in terms of female candidates. You can ask their track record: how many female Board candidates do they have in their talent pool? Can they provide an equal number of female and male candidates on their long list, short list? What is the number of female appointees they had in their last 20 searches?

So far we have been discussing the formal part of diversity on boards. What about the informal part? As women do we really need to bend and lean in ourselves to the boys club to be accepted? What are the true barriers that women on boards face?

Bend yourself would be a waste or your talent. My personal experience is that as I advanced in my career, my relationship qualities were more and more important. Of course, I have my financial, management and legal background. But my main strength is my capacity to listen, to understand the different interests around the table, my ability to bring the parties to a compromise. These are so called feminine qualities, but very much in demand at the top.

Fighting for women rights i.e. for people’s rights is not easy at least for me but it is extremely important. Whenever I see you in webinars or pictures, you have a smile on your face and you are full of energy. Where do you take your energy from?

I would like to pay a tribute to my husband for that. I have been struggling a few times in my career, ups and downs are part of life. He always asked the same question: What would you like to do? I could do whatever I wanted, as long as he could see that I was happy. And for once, I followed his advice 😉

The generations that are now joining the workforce are important for the change towards gender equality. What tips would you give to young men and women entering corporations and institutions? What should they be aware of?

Choose an environment that rewards your talent, choose a job that fulfils you. Life is too short to do something that makes you miserable. There is a so-called war for talent. Be curious, be bold, feel the fear, and do it anyway. That is my favourite book. And – of course – keep smiling.