Gender quotas might not have a sterling reputation, but Germany thinks they’re the answer to its male-dominated corporations. According to a new agreement between the parties negotiating to form Germany’s next governing coalition, supervisory boards…
This idea has been around for some time. In 2011, the 30 companies of the DAX index avoided binding quotas and instead pledged voluntarily to increase the proportion of women in management positions. France, Norway, Belgium, Iceland, Italy, the Netherlands, and Spain have already instituted government-mandated quotas on public companies, though some will only take effect several years from now.
From the U.S., where women held only 16.1 percent of board seats by last count, it’s an intriguing experiment to watch for several reasons. Government-directed quotas are potentially unconstitutional, and even private companies seeking to set quotas have been told affirmative action plans need to meet pretty strict requirements to survive an equal protection or Civil Rights Act-based challenge. But many of the folks following women’s lack of progress on Wall Street would like to see the U.S. be, well, a little more Teutonic.
Quotas might be an awfully illiberal idea, but we can still learn from Germany’s great social experiment. Here’s why.