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Gender diversity quotas 'effective'

Female representation in parliaments up six percentage points, research finds  

25 September 2013

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By Manju Manglani, Editor (@ManjuManglani)

Gender diversity quotas are an effective policy tool for increasing female representation in governance, new research argues.

The Word Bank study of 143 economies found that those with legal quotas had a six percentage points higher representation of women in parliament than those without quotas.

Among the economies studied, six have quotas for women on boards of publicly-listed companies and 12 have legal quotas for women in parliament.

Interestingly, women are represented in 87 per cent of constitutional courts or court-like bodies, where they exist, regardless of whether or not they have quotas.

“The ideal of equality before the law and equality of economic opportunity isn’t just wise social policy: it’s smart economic policy,” said World Bank Group president Jim Yong Kim.

“When women and men participate in economic life on an equal footing, they can contribute their energies to building a more cohesive society and a more resilient economy.”

Impact on performance

The research found that quotas can enable a more equitable representation of women in leadership positions, which may translate into more equitable representation of women’s interests in decision making.

“Decisions by legislative bodies with more women may qualitatively differ from those by institutions with fewer women involved in decision making,” says the report Women, Business and the Law 2014.

“Beyond improving equity in representation and policy outcomes, quotas might help allocate women’s talents more efficiently. The public and practical demonstration of those talents may, in turn, change gender-biased attitudes and social norms, and reveal role models who foster other women’s aspirations.”

The report notes that lower gender legal parity is associated with fewer women participating in firm ownership, while policies encouraging women to join and remain in the workforce are associated with greater income equality.

Recent research by Thomson Reuters into 4,100 public companies globally has also found that the average stock price of gender-diverse corporate boards outperforms that of boards with no women.

It noted that local legal requirements had the greatest impact on the adoption of company policies to improve gender diversity.

Earlier this year, Lucy Scott-Moncrieff, president of the Law Society of England and Wales, said that law firms were letting “mediocre” men dominate their boardrooms because they were failing to adopt “modern” flexible working practices.

“It is not enough to merely pay lip service to the benefits of flexible working. It is not acceptable to consider women who take advantage of flexible working practices as somehow lacking commitment.

“The risk is that boardrooms will be full of men, only some of whose talent warrants their senior positions. Unwittingly, these firms may be losing talented women and promoting mediocre men.”

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