Spain announces significant law to promote gender parity in companies, politics

Ahead of International Women's Day, the Spain government has announced major steps for women to empower them in business and politics.

Spanish Prime Minister Pedro Sanchez has proposed a gender parity law making it mandatory for corporate boards to be composed of at least 40% women. The female quota will also be implemented in the government's cabinet. In politics, the law will require parties to offer equal numbers of male and female candidates during elections, to increase gender parity in parliament. At the moment women make up 44% of Congress and 39% of the Senate.

As per the local media, Spain's gender quota bill will be approved today (7 March) at a weekly cabinet meeting, before being sent to Congress.

If the law is passed, 40% “of the least represented gender” will become part of top management in both companies and politics.

The rule will apply to all publicly-traded companies by July 1, 2024. It will be applicable in companies that have at least 250 employees and €50 million ($53 million) in annual revenues by June 30, 2026.

The latest decision by Prime Minister Sánchez is not unusual. He has repeatedly defined his Socialist-led coalition government as feminist and has pushed high-profile equality laws, including on trans rights and a politically-controversial sexual consent law. Notably, of his 22 ministers, 14 are women. Moreover, all three deputy prime ministers are female.

In December, the Spanish government also passed a pioneering law covering sexual and reproductive health, by offering state-funded paid leave for women who suffer from painful periods.

In Spain, gender equality is commonly seen in the main corporate boardrooms. The local securities regulator has a non-binding recommendation for publicly-listed firms to have at least 40% women on their boards.

Several firms on the Ibex-35 benchmark also meet this 40% quota rule, and some are closer to achieving it. The shortfall in gender parity on boards is more acute in smaller firms outside the benchmark.

Sánchez’s decision to pass a law making board parity mandatory is aligned with a European Union directive issued last year, which demands that such laws be passed in the region by 2026. That directive doesn’t require parity in top management or political positions.