On 6 March 2015, the German Parliament approved a compulsory gender quota of at least 30% in supervisory boards of certain types of corporations, which was also approved by the German Federal Council on 27 March 2015. The nationwide and sector-independent quota applies for all corporations that are (i) listed on the stock exchange and (ii) co-determined on the basis of parity (i.e. employ more than 2,000 employees). From 1 January 2016, these types of corporations need to allocate at least 30% of their supervisory seats to the underrepresented gender.
In contrast to the ministerial draft bill, on which we reported in our October 2014 newsletter, the compulsory quota now applies to the supervisory board as a whole. Only in the event of a protest are stakeholders and employee representatives obliged to fulfill the quota separately. Furthermore, corporations not meeting the quota shall be required to leave the respective seats vacant which may bear the risk of invalid resolutions if the corresponding votes are decisive. The empty seats must be staffed with a person of the underrepresented gender in a court proceeding.
In addition, listed corporations as well as co-determined corporations (i.e. corporations with more than 500 employees) shall define quota targets as from 30 September 2015. The self-imposed quotas shall not fall below the status quo or below 30% if this has been achieved already. Such quotas will be binding on corporations' supervisory boards and management boards as well as to the first and second management levels and are to be achieved by 30 June 2017. There will be no further consequences if companies fail to achieve such self-imposed quotas. However, the target quotas and the level of achievement must be publically announced.
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