STOCKHOLM — Sweden may consider forcing corporate boards to appoint more women after finding voluntary programs failed to bring about greater gender equality.
Companies must “much more carefully take a look at recruitments to boards this spring and at the annual general meetings and we must then see that improvements are being made,” Finance Minister Anders Borg said Wednesday in Stockholm. “If we see another year of things moving sideways” Sweden will “gradually move towards being forced to launch quota legislation,” he said.
The comments come as the government of Prime Minister Fredrik Reinfeldt trails the Social Democrat-led opposition in most polls ahead of September elections. While Sweden consistently tops global rankings measuring efforts to stamp out sex bias, according to the United Nations, businesses in the largest Nordic economy have failed to keep up with state measures to promote gender equality.
About 45 percent of Sweden’s elected officials are female, compared with only 22 percent of senior managers at the country’s 25 biggest companies. Women make up 24 percent of Sweden’s corporate boards, according to an index by Statistics Sweden measuring 231 publicly traded firms.
Annika Falkengren, who heads SEB and is one of only five female chief executive officers at Sweden’s 100 biggest firms, said late last year her country isn’t doing enough to help women succeed in the corporate sphere, and questioned a tendency to “glorify Sweden.”
Still, quotas such as Norway’s requirement of at least 40 percent representation on corporate boards and similar measures in Spain and France, aren’t the answer, she said.
“It is awful to feel that you have been asked to do a job just because there is a quota,” Falkengren said. “The threat of quotas is probably needed, but I have a lot of respect for the owners of the capital, and they should be able to decide who sits on that board.”
Research indicates pushing gender equality makes economic sense. A 2006 study from Sweden’s Uppsala University compared earnings of 48 companies and found that those with more female board members had higher profits and showed greater potential to increase earnings than companies with no women on their boards. Catalyst, a New York-based research and advocacy group, has arrived at a similar conclusion for Fortune 500 firms.
Intense debate around gender equality has gripped Sweden since Jens Spendrup, the chairman of the Swedish Federation of Enterprise, in an interview with Ekot radio on Feb. 8 said one of the reasons fewer women make it to corporate boards is that there’s a lack of competent female candidates.
Borg rejected the argument and said the government is tired of waiting for private enterprise to bring about greater equality.
“There’s been an incredibly slow movement towards female representation so I think there is an impatience in Sweden and in the political system,” Borg said. “It’s very clear that there is no lack of talent” as “we have very good boards in the state-owned companies and they are equal,” he said.
Among companies wholly owned by the government, including utility Vattenfall and SBAB Bank, women make up 49 percent of boards while 43 percent of board chairmen are women, compared with only 23 percent in 2006, according to the government’s website. Still, men’s participation in the labor market is 6 percentage points higher than women’s while the average woman earns 3.6 million kronor ($557,000) less than the average man during a life-time, according to the government.