Will Quotas Promote Women?

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Viviane Reding, the EU Commissioner for Justice, is trying to get a quota policy adopted by Europe that would demand that company boards would comprise at least 40% women. This would be enforceable in the UK once passed as a directive or regulation.

So what’s the big deal? And does such equality matter to SMEs anyway?

In the UK a small proportion of senior posts in quoted companies are held by women. We might speculate that as firms reduce in size, more women are in senior positions but however it’s calculated, women are under-represented at the SME management table too.

This matters because society believes that there should be equal opportunity for all. It matters also because as Ms Reding points out, 60% of all graduates are women so there’s prospectively a lot of talent going to waste.

But some see the fact that many women take time out to have families as fuel for the argument that men overtake women in competency. Women then rightly lose seniority.

There is however a strong counter argument. Women are different. As managers, they tend to be less command-and-control, more consensual; they solicit opinions while men see that as a weakness; and women are better communicators and better at juggling tasks. That means only one thing – there’s a huge benefit in having a good balance of men and women on the management team.

So even if Ms. Reding’s attempts at quotas fail, and even if ultimately SMEs escape the legislation, every firm should strive to have balance in the senior team.

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