Norway’s New Quota: Corporate Board 40% Women Or Else!

It’s now a law in Norway that large, publicly-traded companies must have at least 40% women in their corporate boards … or risk dissolution:

"A woman comes in, a man goes out. That’s how the quota works; that’s the law," says Kjell Erik Øie, deputy minister of children and equality, in the centre-left "Red-Green" coalition government in Oslo. "Very seldom do men let go of power easily. But when you start using the half of the talent you have previously ignored, then everybody gains."

Businesses fought hard against the legislation, but they lost:

… even in Norway the quota went ahead only after years of ferocious debate and some resistance. As one male non-executive director who has survived the recent cull of boards put it, "What I and a lot of people don’t understand is why it is seen as good for business to swap seasoned players for lip gloss?"

But such scepticism was not as widespread as one might expect. Ansgar Gabrielsen, 52, a Conservative trade and industry minister, and former businessman, is the unlikely champion of the quota. In 2002, in the then centre-coalition government, he publicly proposed a 40% quota on publicly listed boards without consulting cabinet colleagues. The law would be enacted in three years, he announced, only if companies failed to comply. The challenge was huge. Out of the 611 affected companies, 470 had not a single female board member.

Gabrielsen’s reasoning at that time set the terms of the debate that followed. The quota was presented less as a gender-equality issue, and more as one driven by economic necessity. He argued that diversity creates wealth. The country could not afford to ignore female talent, he said. Norway has a low unemployment rate (now at 1.5%) and a large number of skilled and professional posts unfilled. "I could not see why, after 30 years of an equal ratio of women and men in universities and having so many women with experience, there were so few of them on boards," he says.

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March 8, 2008 at 4:25 am by Alex
Category: 1 Other Neat Things

21 comments to "Norway’s New Quota: Corporate Board 40% Women Or Else!"

Ben
March 8th, 2008 at 4:56 am
Mandating Equality has never solved any so called “problems”. Now we have reverse sexism.
Evil Pundit
March 8th, 2008 at 6:11 am
How about mandating that 40% of the prison population has to be female? Or adjusting educational outcomes so that males get equal scores and equal graduation rates?

Funny how it seems so unthinkable to consider forced equality in areas where men are disadvantaged.
cuimhne
March 8th, 2008 at 9:14 am
Evil Pundit…you’ve just pointed out 2 reasons why more women should have more access to the top levels in companies (more education and lower rates of crime). Ben, it’ll be reverse sexism when they mandate that there needs to be more women than men on the board.

Unfortunately a law is necessary until it becomes the norm to have equal numbers of male and female employees at the highest levels of management. Why is it that I should be seen as a less valuable employee than a man simply because of my chromosomes? Women do have fewer opportunities than men despite what advances we may have made as a society.
Tony LaRocca
March 8th, 2008 at 10:43 am
Certainly, if a woman is more qualified than a man but loses a promotion to him, she has every grounds to sue. But this law is ridiculous. Why should anyone who has worked for decades to get to the position they’re in lose their jobs just because of political correctness? A much saner way of implementing this rule would be to make it apply only to new companies, or to make it apply only to new members. (If an existing male member leaves, replace him with a female one until 40% is achieved.) Personally, if I was major stockholder in a company, I would want the best people for the job - male or female - on my board.

Yes - to force someone to leave their job because they’re the “wrong gender” is sexism.
SuperJdynamite
March 8th, 2008 at 11:29 am
@cuimhne: “Unfortunately a law is necessary until it becomes the norm to have equal numbers of male and female employees at the highest levels of management.”

You seem to feel it’s a foregone conclusion that legislating away the symptoms of a problem will actually fix its root cause. Meanwhile, the effectiveness of affirmative action laws is at best unclear and at worst unprovable.
Inquisitor
March 8th, 2008 at 12:02 pm
Again we see the socialist try to be gods and defy economics. Their hubris will be punished eventually.
SuperJdynamite
March 8th, 2008 at 2:33 pm
@Inquisitor:”Again we see the socialist try to be gods and defy economics. Their hubris will be punished eventually.”

Lighten up guy (or girl as the case may be). Most of the countries of the world have some kind of affirmative action: http://en.wikipedia.org/wiki/Affirmative_action#Implementation_worldwi de
v.dog
March 8th, 2008 at 2:34 pm
@ Ben, there’s nothing reverse about it. Advantaging one gender over the other, whether they be male or female is sexism, pure and simple.

While I’m happy with the the idea of equality in the boardroom, this is the wrong way to go about it. Whoever is most suited to the job should get it, regardless of gender, should get it. A more qualified man losing out to a less qualified woman simply because there’s ‘too many men’ on the board already is just stupid.

Here in New Zealand, the top three positions of power are held by women (Governor General, Prime Minister and Chief Justice, and until recently,
Attorney General). They got there by being the best person for the job, and not as a result of some arbitary quota.
agent
March 8th, 2008 at 3:29 pm
Why do they have to be forced to hire for 40% women when most women are housewives? They would hire unqualified women.
agent
March 8th, 2008 at 3:36 pm
100% of men work in corporations but only 50% of women work in corporations because half of them are housewives. Mandating 40% women would leave 60% of men unemployed.
David B
March 8th, 2008 at 4:09 pm
Any personel quota in the workplace leads to problems. Passing over a more qualified employee in favor of the quota is bad business. These socialist politicians, regardless of country, are going to be the downfall of capitalism. You can’t succeed while trying to be politically correct. Isn’t it hard enough to deal with nepotism and favoritism in the workplace? Maybe all these women just need to start more of their own companies.
mark
March 8th, 2008 at 4:16 pm
If i want to build a house and I want a hundred men, i must bring 40 women and leave behind 40 men.

Now, i have no reason for wanting only men, i just choose so because it is my will. then i find i have to take 40 women and leave behind 40 men.

someone explain that.

Why am I not allowed to not want women? It is my house, my business, my will. Who’s to say who i need on my team or not. makes no sense, no free will .. :/

(rejection isn’t that bad, without rejection there would be no major progress)
violet/riga
March 8th, 2008 at 6:22 pm
Then 10% of people should be “differently abled”, 10% should be from an ethnic minority, a further 10% should be “of a certain age”…

Forcing such things is madness. Encouraging females in boardrooms is a good thing, but you should employ whoever is right for the job.
Jim
March 8th, 2008 at 6:30 pm
This is such silliness. Sounds like they want these companies to leave.

Hey NORWEGIAN COMPANIES the USA would love you….COME HERE!
Evil Pundit
March 8th, 2008 at 7:50 pm
SuperJdynamite:

Your link lists 17 countries that practice affirmative discrimination.

There are over 200 countries in the world.

Consequently, your claim that “Most of the countries of the world have some kind of affirmative action” is invalid.
Christophe
March 9th, 2008 at 12:33 am
violet/riga summed it up : who’s right for the job?

I believe creating in a system helping “minorities” to have doors opened and climb the social ladder, but enforcing it opens the Pandora box : after the sex, the skin color, the disability, why not ethnic groups, size, age, religion, political views, etc…

“All corporate boards must have 1.56% of female, petite, 23 to 26 1/2 years old, redhead from proven Scottish ascent, bouddhist, licensed in knitting, members”

Yeah, right.
Tom
March 9th, 2008 at 11:04 am
It should be done on a sliding scale, perhaps based on the ratio of women graduating from MBA or equivalent program from, say, 20 years ago (or whatever the average lag time is found to be between graduation from school and entry into executive positions for men.

You can’t just wave a magic wand and produce female executives. It takes time to train them, and time for them to gain leadership experience.
Dave
March 9th, 2008 at 11:48 am
“… diversity creates wealth.” I’ve heard some ignorant things in my time, but that line takes the cake. Spoken like a true bureaucrat.
Alecks
March 9th, 2008 at 2:32 pm
This is good. Before behind-screen auditions were widespread for musicians, hardly any women at all were accepted into symphonies. Now women make up half of these orchestras.

However, for a position on a corporate board, there’s no similar way to get rid of inherent bias. In a study where the exact same resume was sent out with either obviously white names or obviously black names, only the obviously white resumes were really looked at. Similarly, I would suspect that people would be dismissive of resumes with female names on them in addition to falsely perceiving, once they actually meet the person and find out that she’s female, that there’s something not as strong, or willful, or collected about this woman, just as the judges in the pre-blind auditions falsely perceived a lack of emoting and virtuosity when they saw the performer was a woman.

In the end, when these companies ignore half the talent in creating their corporate board, they’re only hurting themselves.
MikeB
March 9th, 2008 at 10:50 pm
At the Veterinary school my wife attended each class was about 75 people and of those only 3-5 were men (1 or 2 will be Asian/Indian but no other minorities, just a bunch of white girls). Implementing a socially accurate quota would drastically reduce the number of better qualified women that have been striving to work in this field their whole life. Veterinary medicine just isn’t as popular of a profession for men any more. It is not that women are being chosen over men, the men simply aren’t applying. To force acceptance simply to meet quota levels is absurd for the vet school and for corporate boards.
Woman
March 10th, 2008 at 8:13 am
WOW, the comments here! Men do think that women are just not as qualified as their male counterparts, and that there’s no bias against women preventing them from achieving certain positions, amazing. I want to move to Norway…

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