European authorities target problem of banks with few women on boards

By Huw Jones

LONDON, March 7 (Reuters) – The European Union’s banking watchdog said on Tuesday it would crack down on the 28% of banks that have failed to implement mandatory regulations on diversity on boards of directors. ‘administration.

The European Banking Authority (EBA) said data collected at the end of 2021 from nearly 800 banks and investment firms showed women made up just 18% of executive directors and 28% of non-executive directors.

Women earn on average 9.5% less than executive directors and 6% less than non-executive directors.

Since 2014, banks have been required to have diversity regulations, but 28% still do not, according to the EBA. Although banks are allowed to set their own targets for women on boards, some EU states have passed national laws with targets.

“We will take action on this and look at what national supervisors are doing,” said Bernd Rummel, a policy expert at the EBA, where women make up 60% of directors.

“It’s important that all banks have diversity policies and have their own targets. It has to be 100%,” Rummel said.

“The gender balance is gradually improving, but too slowly,” the EBA report says.

The big banks and those in Northern and Eastern Europe are doing better on diversity, perhaps thanks to better childcare services in those countries.

Almost half of the banks in the sample did not have a female CEO, despite mixed companies having an above-average return on equity of 7.9%, compared to 5.3% for those that did not. only have male CEOs, according to the EBA.

Other types of diversity, such as educational or social origin, could also be improved, according to the ABE.

Most companies with operations in other parts of the world had leaders who reflected this fact, according to the report.

The EU has just passed a law requiring that at least 40% of non-executive board members of listed companies be women by mid-2026.

(Reporting by Huw Jones; Editing in Spanish by Tomás Cobos)