Equality of treatment and opportunities between women and men is among the principles set out in the Treaties of the EU in the European Pillar of Social Rights.

Aiming to promote gender balance in decision-making at the highest levels of corporate governance, the Directive introduces transparent recruitment procedures in listed companies so that at least 40% of non-executive director positions or 33% of all board positions are occupied by the under-represented sex.

For member states that choose to apply the directive to executive and non-executive directors, the target will be lower — 33% of all director positions by 30 June 2026.

Small and middle-sized companies with fewer than 250 employees are excluded from the scope of the Directive.

Member states can suspend implementation of the Directive for five years if they have already taken binding measures that are equally effective or made sufficient progress that the targets set out in the Directive are close to being met. 

Once a year, companies will be required to provide information about the gender representation on their boards and the measures being taken to achieve the 33% or 40% objective. A list of the companies that have achieved the directive’s objectives will be published annually.

Here there is a short analysis of the gender balance on corporate boards updated in June 2022 that shows that even if women account for around 60% of new university graduates in the EU, they remain heavily under-represented in economic decision-making, especially at the top. According to a recent survey by European Women on Boards, on April 2022, the situation in Europe was the following:

The Directive still needs to be adopted by the European Parliament. However, the Council and Parliament did reach a preliminary political agreement on the Directive earlier.

The Netherlands has already adopted a national legislation: the law 'Balancing the ratio of men and women on supervisory and management boards' has been in force since 1 January 2022, providing that any appointment (of a supervisory director) that does not make the gender ratio within the supervisory board more balanced, is null and void.

If the Directive is formally approved, all member states will have two years to adopt the required national measures.