That leave be granted to introduce a Bill entitled an Act to make provision for the regulation of gender balance on the boards and governing councils of corporate bodies and related matters.
This Bill will make provision for the regulation of gender balance on the boards and governing authorities of corporate bodies and related matters. In so doing, it will provide for gender quotas to be introduced at boardroom level. It will require all companies to have 33% of each gender on their boards within a year of commencement of this legislation and 40% within three years. It will compel companies, as set out in the Companies Act 2014, to submit an annual report to the Companies Registration Office on the gender balance within their boardrooms. This Bill will not apply to unincorporated associations, partnerships, limited liability partnerships or single director companies. It will also not apply to micro-companies, as defined in the 2014 Act, or other corporate bodies with an annual turnover of less than €750,000, or that employ fewer than 20 employees, or both.
The 33% and 40% gender quotas will be mandatory, but will be built on a comply-and-explain mechanism. This means companies that do not meet the gender quotas will have the opportunity to explain why they could not meet the quota before any action is taken to compel compliance. The law will include a statutory right that will allow any interested party to apply to the High Court for an order to compel compliance where companies' explanation for non-compliance is deficient. All companies that do comply can also apply for a certificate of compliance from the Company Registration Office. This will help them attract and retain talent and it will showcase the companies that lead on the issue of gender balance.
It is my ambition that this Bill will pave the way for balanced representation of both men and women in leadership roles in business. Currently, we use soft targets to measure and drive the representation of women in the boardroom. It is a welcome start, and I commend the work done by bodies such as Balance for Better Business and the 30% Club. Unfortunately, however, gender balance in our boardrooms is not improving quickly enough. Women accounted for only 22.4% of board members in Irish listed companies as of September last year. Shockingly, one in five Irish listed companies have no female directors at all.
Boardroom gender quotas have been successfully implemented in a number of European countries. They are advocated at EU level and were a recommendation of the Citizens' Assembly on gender equality earlier this year. A recent report by the National Women's Council of Ireland shows the impact they could have in Ireland. Gender quotas are shown to broaden the talent pool available to employers and ensure boards think outside the box when it comes to replacing board members, rather than repeatedly replacing them with people of the exact same profile. Companies with balanced boardrooms make better business decisions. They are shown to perform better financially, and that leads to trickle-down benefits for women at all levels in all companies. This Bill will create the opportunity for men and women to be fairly represented at the top table of business and, ultimately, to a better balance in the boardroom being achieved.
I thank William Aylmer from the Kevin Jacob-Bernard McCormack branch of Fine Gael in the Dublin Mid-West constituency for his assistance in drafting this Bill. I also thank the Bills Office and the Office of Parliamentary Legal Advisers. I am grateful to the Fine Gael Women's Network for its support and to the National Women's Council of Ireland, which collaborated with me on the Bill and which has been a driver for change in this and all other areas of female representation.
Our boardrooms must be a better reflection of society. We all have a role to play in breaking down the unconscious biases and the reinforced stereotypes that exist. It is my ambition that both men and women will have equal opportunity to not just get their foot in the door but to earn a seat at the boardroom table. I am grateful to the Ceann Comhairle for the opportunity to bring this Bill before the House today.