Amendments to the Companies Act
On December 5th, 2024, amendments to the Companies Act entered into force.
The amendments introduced an obligation to ensure balanced representation of women and men on supervisory and management boards.
Who is it applied to?
The obligation applies to all listed companies that meet all three of the following criteria:
- employ more than 250 employees,
- annual revenue exceeding 50 million euros, and
- total assets greater than 43 million euros.
What does this mean?
The companies that meet the above stated criteria must ensure that, by June 30th, 2026, representatives of the underrepresented gender hold at least 40% of non-executive director positions or at least 33% of all director positions.
To implement the above, the following is prescribed:
- The selection of candidates for appointment or selection of directors should give priority to an equally qualified candidate of the underrepresented gender;
- The decisions on the selection of directors passed contrary to the abovementioned measure will be considered null and void;
- The obligation for the management to inform every shareholder with the right to appoint a member of the supervisory board, as well as the works council, about the subject obligation to ensure balanced gender representation on the supervisory board;
- The obligation to include data prescribed by the act regarding gender balance in the annual report on the status of the company;
- The obligation to set goals for the participation of the underrepresented gender at least every two years.
In addition to the abovementioned obligation, further requirements are introduced for the supervisory board regarding the independence of at least one of its members and the participation of members when giving prior consent for transactions with related parties.
The obligation for the management to prepare an annual report on transactions with related parties and the obligation for shareholders to notify the company about the conclusion of shareholder agreements are also introduced.