Increasing gender equality on board level through stay-on-board regulations

Abstract

Diversity and gender equality in executive boards, as well as finding ways to balance private needs and business requirements, are topics that are on the agenda of legislators around the globe. Given the significant role of executive board members in shaping organizational strategy and culture and for the company’s success, understanding the impact of rules that allow a mandate pause for this group is essential. The German ‘stay-on-board’ rules grant a mandate pause to board members for maternity, parental or care leave or for a board member's convalescence since August 2021. The objective of this paper is to examine the necessity for a legal framework on the European Union level that provides for a mandate pause for board members as a way to increase gender equality on the board level. The author recommends closing the gap in gender equality on the board level at European level by adopting comparable measures to those implemented in Germany, supplemented by additional measures. The implementation of a comprehensive set of measures, in conjunction with widespread acceptance in society, is crucial for the advancement of gender equality within corporate boardrooms.