France became a pioneer in 2011 by adopting the Copé-Zimmermann law establishing quotas on company boards of directors. Ten years later, the Senate undertook to take stock of it, in a report published in July 2021.
The High Council for Equality between Men and Women (HCE) already highlighted in 2019 the positive impact of quotas on boards of directors, while proposing ways to improve women's access to positions of power.
This observation is shared by the Senate, which proposes a systematic evaluation of the law. While he underlines the enormous progress made possible by the latter, he also shows its shortcomings, and makes recommendations to go further. With this in mind, the President of the National Assembly's delegation for women's rights, Marie-Pierre Rixain, tabled a bill to accelerate economic and professional equality, which was adopted at first reading in the Assembly in May 2021.
Quotas work !
The quota policy has had the desired effect: this is the first observation of the Senate. A single indicator illustrates this performance : France, with 46% of women on its boards of directors, is the first country in the world to have feminized the boards of directors of large listed companies.
This is particularly true in the CAC 40 companies, and beyond, among the 80 stocks in the top 200 market capitalizations. France is far ahead of Norway, Italy, Sweden, Finland, Germany and the United States. It is indeed the legislative system that has led to this forced change, since in ten years, this proportion has more than tripled. This is also true elsewhere : the most significant progress has been made in countries that have introduced quotas, such as Norway in 2003, Italy in 2011, and California since 2018.
With hindsight, the Senate considers that targeting boards of directors was a good thing, insofar as it is there that the company's main lines of conduct are decided. The risk of sanctions obviously weighed, as did questions of image, the progress of each major company having been particularly scrutinized by financial analysts.
What are the effects on corporate governance?
The law has led to profound changes in the very governance of companies, which was also one of the expected effects, whether in decision-making, adaptation to customers, creativity, etc.
Heard by the Senate, Laurence Parisot, former president of the Medef, spoke of changes in " style", then in a second phase, of a real influence of women in the life of the company, right down to the decision-making process: " A mixed board of directors introduces a form of modesty and prevents any drift of power ".
Another positive impact is that the law has made it possible to professionalise boards of directors. Women who hold office have indeed undergone specific training. For example, the French Institute of Directors offered training to women and men very early on. With consequences in terms of sustainable governance for the company, according to a study carried out by Ethics and Boards published in March 2021. The consideration of environmental impact, CSR being much higher in companies led by women.
The limits of the law : the glass ceiling and operational management, other companies
Despite its positive effects, the law shows its limits in terms of trickle-down in the entire economic fabric. There are not enough women in companies outside large market caps. In small-cap companies, women make up only one-third of the board table.
Unlisted companies with 500 or more employees and at least €500 million in turnover have less than 25% women on their boards of directors. In SMEs, where the law does not apply, women are represented at 18%.
In addition, there are still obstacles within the companies that have made the most efforts. " The law has stopped at the gates of power ," said the HCE in 2019. This is one of the main limitations ten years later: decision-making bodies such as management committees (Codir) or executive committees (Comex), not falling within the scope of the law, have not opened up everywhere to gender diversity.
Another perverse effect is that even within the boards of directors applying the law, a " glass ceiling" has appeared. This is another limitation highlighted by economists Sophie Harnay and Antoine Rébérioux. The law has certainly made it possible to break down the barriers to entry to boards of directors, but not those that have been erected inside. Women's access to the most strategic and best-paid committees within the boards of directors remains problematic. It's simple, only 26% of women are part of strategic committees such as the audit or the choice of the CEO.
Extension of the obligations ... the recommendations of the Senate and the 2021 Act
To move forward, the Senate recommends extending parity obligations, first of all by broadening the scope of the companies concerned : SMEs, but also by further lowering the threshold of 250 employees as already proposed by the HCE in 2019, to gradually arrive at a parity obligation of 20 per cent in 2023 everywhere and 40 per cent in 2025.
Another recommendation is to broaden women's access within the company not only to boards of directors, where recruitment is done externally, with women who do not hold a position in the company, but to management committees and executive committees.
The idea would be to be able to promote women internally. However, the Senate does not want a strict obligation set by law as in 2011, so as not to create perverse effects by excluding men employed in these same companies who would have access to them. It is based on the law of 23 March 2021, which proposes to measure the proportion of women and men in positions of responsibility (senior executives and executives who are members of management bodies) in companies with more than 1000 employees. The goal is to reach 30% by 2027 and 40% by 2030.
Because the pool of women competent to sit on such bodies is proven, the Senate also recommends limiting the number of directorships that can be held simultaneously by the same person to three instead of the current five. In order to free up places for women. This was a proposal that had already been made during the examination of the Copé-Zimmermann law a few years ago... Ten years.
The Senate and the 2021 law also propose to extend these obligations to business creation, by setting gender diversity objectives for Bpifrance and investment funds. The Senate also suggests setting up a fund dedicated to the financing of women's entrepreneurship within Bpifrance in order to facilitate their access to credit, an avenue taken seriously by Minister Alain Griset during his recent hearings.
Thus, the creation of quotas in executive and management committees seems to be the next step to continue what the law passed 10 years ago has made possible. This would create an " interior staircase" for women, according to the expression of MNA Marie-Pierre Rixain.
The deputy's bill must now be definitively adopted, with the majority hoping for a final vote by the end of 2021. It also remains to apply more transparency in terms of gendered data, through systematic declarations via Infogreffe for example. Finally, in order for women to be the first drivers to advance the cause of equality, the Senate also insists on the usefulness of developing existing women's networks and forums.
