29.11.2024

COMPANIES IN OUR COUNTRY ARE REQUIRED TO APPOINT WOMEN AS BOSSES

33% of all director positions, both with and without executive functions, on the management and supervisory boards, respectively on the boards of directors in companies listed on the stock exchange, to be held by members of the underrepresented gender, which is most often women.

This is provided for by changes to the Law on Equality between Women and Men, which have been put up for public discussion. Their share must not exceed 49%. A deadline for achieving the goal is set - June 30, 2026.

Requirements are introduced for public companies to report information on whether they are achieving these goals. In their corporate governance declarations, which they currently submit every year, they must provide information on the number of men and women in their management bodies, among executive directors and non-executive directors, on the measures taken to achieve the goal and on the reasons in case the goal is not achieved (the "comply or explain" principle). A deadline for the first reporting is set - in 2026 for the reporting year 2025.

Companies must publish in a visible place on their website by May 15 of the current year the information for the previous year.

The Financial Supervision Commission is obliged to publish by June 30, 2026 on its website a list of public companies that have achieved the set goal, and to update it annually, providing it at the request of the Minister of Labor and Social Policy.

Those who do not publish such information will be fined.

A requirement is introduced for public companies that do not meet the set quantitative goal to adapt the procedures for selecting members of the management and supervisory boards, respectively the board of directors, by ensuring:

a comparative assessment of the professional qualifications of each candidate;

clearly formulated, neutral and unambiguous merit-based selection criteria, which are applied in a non-discriminatory manner throughout the selection process;

giving preference to the candidate of the underrepresented sex when the selection identifies candidates with equal qualifications, competence and professional results.

This will not apply when the selection gives greater weight to other diversity policies that provide an advantage in favor of the candidate of the other sex.

It also introduces a requirement for companies to disclose the selection criteria, if requested by the rejected candidate, as well as the specific considerations providing an advantage. When challenging the selection of members of the management and supervisory boards, respectively of the board of directors of a public company, the rule of reversed burden of proof, which is regulated in Art. 9 of the Protection against Discrimination Act, shall apply.

Public companies will be obliged in the invitation to hold their general meeting, when an item is provided for the election of a member of the management or supervisory board, to publish information on the requirements regarding the provisions on the quantitative target for balanced representation of women and men, the selection procedure with a view to achieving the target, as well as the applicable measures and sanctions in case of non-compliance.

The Minister of Labour and Social Policy will be the body for promotion, analysis, monitoring and support in relation to gender balance in the management bodies of public companies. He is also responsible for reporting to the European Commission on the implementation of the Directive. In this regard, a mechanism for exchange of information is provided by providing information to the body by the Financial Supervision Commission and the Commission for Protection against Discrimination.