A “quota silo” or positive equality reach? The equality impact of gender quotas on corporate boards in Norway

Abstract

Abstract10 years after its implementation, we explore the equality reach of the 40% Norwegian gender quota regulation for boards of public limited companies (PLCs) using a multi‐strategy approach (administrative data and interviews with women directors) to capture interrelated macro and meso changes. We employ Acker's (2006) inequality regimes as our analytical framework, augmented by the “equality reach” concept. We found strong compliance with the 40% Quota. However, there was little evidence of voluntary spillover to limited companies as envisaged by Quota proponents; instead Quota coverage reduced as some PLCs changed status to avoid the Quota requirement. We reveal that positive equality reach in one of the most equal countries in the world is confined to a PLC “quota silo,” which has shrunk over the life of the Quota. Moreover, we suggest that PLC high levels of compliance may be a defensive strategy seen as necessary in the regulatory/high sanction context of the Quota. We demonstrate the need for further political and organisational interventions to improve equality reach beyond the quota silo. We also show the value of the equality reach concept for research on equality interventions and warn of the dangers of an intervention leading to an equality silo.

What is an equitable target percentage for women on corporate boards?

“…Norway's quota adoption became a vital threshold for corporate gender equality (Dale-Olsen et al, 2013;Machold et al, 2013;Mensi-Klarbach and Seierstad, 2020), and the authors would argue, possibly, the start of the erosion of organisational masculinity. Seierstad et al (2020) claim that in Norway, a "quota silo" emerged, with positive internal reach but a narrow national equality reach and state (p. 168), "The PLC quota silo is distinguished by its strictly regulated internal equality reach, in contrast to unregulated companies having weak internal reach and a resilient glass ceiling". Quota targets were seen to be restricted to some PLC companies, and the expected spillover to Ltd companies did not occur in any meaningful way.…”

Drivers of diversity on boards: The impact of the Sarbanes‐Oxley act

“…We also used a difference‐in‐difference approach (e.g., Seierstad, Healy, Goldeng, & Fjellvær, 2020) to observe firms that did not meet the board independence criteria at the end of 2001 as was eventually mandated by SOX (2002) and subsequent exchange listing rules. These companies formed the treatment group and we compared them with the control group of firms that met the SOX related board independence criteria in 2001.…”

“…We also used a difference-in-difference approach (e.g., Seierstad, Healy, Goldeng, & Fjellvaer, 2020) to observe firms that did not meet the board independence criteria at the end of 2001 as was eventually mandated by SOX (2002) and subsequent exchange listing rules.…”

Female Representation on Corporate Boards in Europe: The Interplay of Organizational Social Consciousness and Institutions

“…Norway, in fact, first experimented with self-regulatory quotas before deciding it needed to switch to punitive quotas to make firms take these regulations more seriously. Furthermore, although the representation of women on boards remains very high in Norway, this presence seems to be restricted to publicly listed companies (Seierstad et al, 2020). Moreover, quota regulations specify the minimum levels of acceptable representation.…”