In the area of equal opportunities for men and women, alongside the current debate on the gender pay gap (see the Czech implementation of the EU Pay Transparency Directive, which is currently under discussion), another previously high-profile issue has returned to the agenda: so-called gender quotas for leadership positions in publicly traded companies (listed companies). This initiative is based on Directive (EU) 2022/2381 of the European Parliament and of the Council.

The proposed legislation (primarily amending the Czech Capital Market Undertakings Act and currently awaiting its second reading in the Chamber of Deputies) requires listed companies to set one of the following targets: (i) achieving at least 40% representation of the underrepresented sex (currently women) among non-executive directors (i.e. members of supervisory boards and members of administrative boards who are not involved in the day-to-day management of the company); or (ii) achieving at least 33% representation of the underrepresented sex among all members of elected corporate bodies. When selecting candidates for these positions, listed companies will be required to establish clear, neutral and binding selection criteria in advance and provide these criteria to the Czech National Bank. Preference may generally be given to a candidate on the basis of sex only where the selection process demonstrates that the candidates are equally qualified for the position. The proposed gender quotas are not intended to apply to small and medium-sized listed companies.

In April this year, the European Commission took the first formal steps towards infringement proceedings against the Czech Republic and eight other EU Member States that have not yet transposed the Directive into their national legal systems, despite the implementation deadline having expired at the end of 2024.

Authors: Helena Hailichová and Filip Rebeka