BOARD ADVISORY · DIVERSITY & GOVERNANCE
For appointments to German executive and supervisory boards, gender balance is no longer just a question of attitude. Many companies face fixed legal requirements, and an appointment that breaches them can be void. Anyone who considers diversity only when a specific seat falls vacant has often started too late.
What applies to the supervisory board
Listed companies subject to parity co-determination must fill their supervisory board with at least 30 percent women and at least 30 percent men (Section 96(2) German Stock Corporation Act). An election that breaches the quota is void, and the seat remains vacant.
What applies to the executive board
Since the Second Act on Women in Leadership Positions (FüPoG II), listed companies subject to parity co-determination with more than three executive board members must include at least one woman and at least one man on the executive board (Section 76(3a) German Stock Corporation Act). An appointment that breaches this rule is void.
Targets for everyone else
Companies that are listed or co-determined must set and publish targets for the share of women on the supervisory board, the executive board and the two management levels below. A target of zero must be justified. This also affects many GmbHs with a supervisory board.
In addition, there is the EU directive on gender balance among directors of listed companies (“Women on Boards”). Whether and to what extent it creates further obligations depends on the German implementation and the structure of the individual company, and should be checked legally.
What this means for appointments
- Plan early: which seats will become vacant in the next two to three years, and how does each appointment change the ratio?
- Look at the full market: searching only in your own network usually produces the same profiles. A systematic market analysis shows how many qualified candidates actually exist.
- Competence remains the yardstick: the quota does not replace a role profile. It requires the profile to be well defined and the market to be considered in full.
- Build the pipeline: minimum participation on the executive board can only be met sustainably if the levels below are developed too.
More than compliance
Boards that bring together different experiences and perspectives tend to decide more thoroughly. Diversity is therefore most effective when it is part of the skills profile rather than a metric met after the fact.
How I support supervisory boards and owners with appointments: Supervisory & Advisory Board Appointments and Board Advisory.
This article provides a general overview and does not replace legal advice in individual cases.