DBRS Morningstar: Gender Diversity at European Banking Boards: Still a Long Way to Go

DBRS Morningstar has released a commentary about the gender composition of European banks’ boards. The commentary examines the current make up of boards of directors/supervisory boards against those of five years ago, whilst also analysing legislative and policy-based approaches to improve representation.

Key highlights include:

• Whilst there have been increases over the past 5 years, women remain significantly underrepresented on banking boards. On average women represent 32% of board membership, as opposed to 22% in 2014.
• Norway and Sweden are some of the few countries in our sample with female representation at the Chief Executive level. Out of our sample of 53 European banks, only 6 have a female Chief Executive.
• One of the legislative measures used at a national level has been the imposition of gender quotas for boards. Of the top 5 most gender diverse countries in our analysis, two have imposed quotas.
• Unlike other Scandinavian countries, neither Finland nor Denmark impose quotas on board membership. Instead, Finland funds programs whose aims are female skill development, while Denmark requires its largest companies to maintain policies on how they will attain executive management-level gender diversity.

“Gender diversity has become an increasingly important issue for the banking sector, particularly as ESG factors have grown in importance for investors when evaluating banks. Despite recent changes, women still represent less than a third of board membership at European banks. Representation is especially low at the Chief Executive position, with only 6 women at the helm of a sample of 53 banks across Europe. In order to accelerate representation at the highest level, some countries have introduced country-wide board-level quota legislation, whilst other geographies have found more success in implementing bank-specific policies aimed at improving representation at the individual institution” said Kevan Viagas, Financial Analyst.

The full commentary “Gender Diversity at European Banking Boards: Still a Long Way to Go” is available at www.dbrsmorningstar.com.