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Malta opposing EU law to put more women on top

Malta opposes plans by the European Commission to impose a 40% quota for female board representation on publicly-listed companies by 2020.

Matthew Vella
10 September 2012, 12:00am
Justice minister Chris Said said EU should not force companies to increase women on boards.
Additional reporting by Raphael Vassallo

Malta will oppose plans by the European Commission to impose a 40% quota for female board representation on publicly-listed companies by 2020 and join a diplomatic push by the United Kingdom to stop the proposal.

Brussels plans to force companies listed in the EU to reserve at least 40% of non-executive director board seats for women by 2020 or face tough sanctions: a move that will directly affect government-participant companies like Bank of Valletta, as well as other plcs like HSBC Malta, GO plc, International Hotel Investments, Fimbank, Lombard Bank, Farsons, Middlesea Insurance, Island Groups, and even Maltapost.

The proposed legislation, expected to be formally introduced by Viviane Reding (pictured above, with justice minister Chris Said), the EU's justice commissioner, next month, aims to address gender imbalance across the bloc's 27 States.

According to the European Commission's database of gender quotas, Malta's 19 largest quoted companies trading on the Malta Stock Exchange are all chaired by men, with the company boards having just three women, while the rest of the directors, 97, are men.

The currently dismal representation of just 3% of women on company boards will mean a radical shake-up of Malta's largest companies' decision-making boards.

The proposed EU law will exclude publicly-listed companies that are SMEs, which have less than 250 employees or an annual turnover of €50 million.

But the quotas would affect companies like Bank of Valletta, in which government retains a 25% shareholding and the right to appoint the chairperson of the board of directors: BOV's nine-man board has no women, the last female director having been Marlene Mizzi, the former chairperson of defunct national shipping line Sea Malta. No woman has ever been appointed to chair the bank's board of directors.

In the case of state-owned companies trading on the stock exchange, gender quotas will come into force by 2018.

Justice minister Chris Said confirmed that Malta is part of a diplomatic push spearheaded by the UK to send a joint letter to the Commission president Joe Manuel Barroso to oppose the mandatory quotas. "Malta will continue to reiterate that any targeted measures in this area should be devised and implemented at national level," Said told MaltaToday.

The letter, a draft of which was obtained by the Financial Times, notes that individual countries are already trying to address the issue either through voluntary or their own mandatory programmes, and insists that the EU refrain from meddling in national efforts.

"These efforts must be granted more time in order to establish whether they can achieve fair female participation in economic decision-making on Europe's company boards," the letter drafted by Britain said.

"For these reasons, we do not support the adoption of legally binding provisions for women on company boards at the European level," the letter concluded.

Said said Malta recognised the importance of having more women actively engaged in power-sharing and in the decision-making process. However, he said quick solutions like the EU's quota law was not the best way to bring about such gender equality.

"It would be counterproductive for the EU to work towards developing legislative measures in terms of legally-binding quotas, given the very different situations and starting points in member states making it very difficult to foresee how a 'one-size-fits-all' solution can be implemented effectively across the EU."

Said also said that in consultation with social partners, the emerging trend in Malta was a preference for a "merit-based approach that ascertains real equality", rather than becoming a board member based on a quota.

"[This] should be done through the development of strategies and policies that consolidate such initiatives and not through the imposition of quotas. The real solution does not rest with numbers but with fair and effective participation between women and men in society. In fact, Malta feels that this is fundamentally a cultural change and quick solutions may not necessarily produce the best results in the long run."

Said that the Maltese government believes in self-regulation rather than legal imposition of gender quotas.

"In the event that these voluntary measures don't achieve adequate results, more targeted measures may need to be considered in order to ascertain results in this area, although it is felt that this should be done at national rather than European level

Poor equality record

The Maltese government says it has taken the initiative to ensure that women are well represented on boards and committees in the public sector. It has introduced tax breaks for mothers returning to the labour market.

A cursory glance at the public sector's main corporations and government-owned companies also indicates that the presence of women on boards is probably already at 40% on average.

But within the private sector, 'board-ready' women are not adequately represented.

The European Commission says that according to the EU Labour Force Survey, Malta has over 1,000 women (25%) in the private sector who are directors and CEOs or managers of small enterprises, compared to over 4,000 men who have the same roles in private business.

And yet, nearly 60% of university graduates are women, a heartening figure that is dampened by the fact that Malta has the lowest rate of female participation in the labour market of all the EU member states, according to the Labour Force Survey - in 2011, women composed just 34% of the national workforce.

Additionally, Malta's severe gender imbalance is felt in other aspects of public life: across the civil service and the nine government ministries, there are only eight women in the highest, non-political administrative positions compared to 92 men (level 1 administrators), and 28 women compared to 72 men in level 2 administrative roles.

The Central Bank's board of directors and its committees have just three women compared to 11 men on decision-making bodies.

The Maltese courts have three women judges out of 21, but nine women magistrates out of a total of 20.

In politics, the gender imbalance persists with (up to end-2011) just nine women elected mayors (13%) out of 68, and 98 female councilors (22%) compared to 345 male councillors. Mayors are elected if they have the highest first-count vote, within the party that gains more seats on the council.

And in the national parliament, only six women have been elected to the House of Representatives, just 9% of the 69 MPs.
Government companies, corporations
Source: Department of Information
  Women Men
Air Malta 2 5
Gozo Channel 3 4
M.I.A. plc 1 5
Malta Government Investments/MIMCOL 2 3
Bank of Valletta 0 9
Wasteserv 3 4
IPSL 0 5
Central Bank 2 3
Malta Stock Exchange 2 3
Grand Harbour Regeneration Corporation 1 4
Public Broadcasting Services 2 5
Malita Investments plc 1 4
Employment Training Corporation 4 7
Enemalta 4 5
Malta Enterprise 3 8
Malta Freeport 0 3
Malta Industrial Parks 2 4
Water Services Corporation 4 5


Matthew Vella is editor of MaltaToday.com.mt.

After graduating in a...

Ethelbert Scehmebri
In principle I don't agree with quotas for women because they are discriminatory, women don't need quotas to prove their wort for society but they only need the chance to prove themselves. Said that, what I find funny in the Govt position is that they talk about the importance that this kind of law must be tackeld individually by each member state , they talk about business, they talk about statistics but they fail to talk about the issue of how to stop this discrimination against women !! It seems that they are more interested in money than equality. I am more than sure that if in our country meritocracy is how people are chosen for a job, this discrimination will cease!!! Women don't need quotas but respect ... but till our society don't want to learn what to do ?????