Talya Hutchison, Associate
Paul Hastings (Washington, DC)

While only 8 years ago, gender diversity on corporate boards in Italy was extremely low, today that number has increased dramatically, as a result of proactive steps taken by the Italian government.  In 2009, only 4% of Italian public companies had at least one woman on their boards of directors.1 Although the representation of women on boards of larger Italian public companies was ten percentage points higher, research from the EU Commission showed that among European Member States, Italy’s percentages of gender diversity on boards was among the lowest.2

That started to change in 2011 when Italy passed a law mandating a quota for gender diversity.  Since then, the percentage of female directors on boards has skyrocketed.  As of December 2016, Italy was second only to France with a staggering 31.4% of female directors.  By June 2017, that number had grown even higher.

Italy’s Gender Parity Law and Consob Regulations

On June 28, 2011, the Italian Parliament passed with a supermajority vote3 a mandatory, albeit temporary, gender quota law (Law No. 120/2011) (the “Gender Parity Law”),4 which applies to public companies with shares traded on the Italian Stock Exchange, Italian companies listed in EU stock markets, and Italian state-owned enterprises (“SOEs”).  The Gender Parity Law requires these companies to have gender parity on their boards of directors and boards of statutory auditors starting from the first renewal occurring one year after enactment, e.g., August 2012.5

The Gender Parity Law as written will only apply to three renewals of the boards of directors and the boards of statutory auditors.  Because such boards can be appointed for a maximum period of three years, the law will be effective, with respect to each listed company, for up to nine years from the first renewal of the respective board – at most, then, ten years following enactment of the law.  Pursuant to the Gender Parity Law, Italian public companies are required to change their bylaws to ensure that the underrepresented gender (whether men or women) receive at least 20% of the director positions and statutory auditor positions in the first renewal of the board of directors.  For the second and third renewals, the Gender Parity Law requires that at least 33% of the board and statutory auditor positions must be filled by the underrepresented gender.

Commissione Nazionale per la Società e la Borsa (“Consob”)6 and the Gender Parity Law also addressed the issue of gender balance in cases of staggered boards.  The gender balance not only has to be respected for three consecutive renewals of each portion of the board, but also in relation to the entire board. Assume, for example, that a board is composed of nine members and each year three members of the board have to be appointed or renewed for a three-year period. In this scenario, the quota requirement of 20% (for the first renewal) and 30% (for the second and third renewal) must be applied both in relation to three board members to be appointed or renewed each year and in relation to the composition of the board as a whole.

In the event that public companies fail to comply with the mandatory quota rule, a multi-tier sanctioning scheme would apply.  First, Consob would issue a notice warning such companies to comply with the Gender Parity Law within four months from notification. If the legal quota is not met within such four month period, any such noncompliant companies will be charged a fine of up to €1,000,000 or €200,000 depending on whether the violation concerns, respectively, the board of directors or the board of statutory auditors.  There is currently little information available regarding the financial penalty’s role in compliance, or even if any fines have formally been assessed. 

In addition, Consob will issue another formal warning directing noncompliant companies to comply with the mandatory quota within a subsequent three-month period; in the event such companies again fail to comply, the election of the board of directors and/or the board of statutory auditors, as the case may be, will be null and void and all elected members will be removed from their positions.

The Gender Parity Law also instructed Consob to issue detailed regulations addressing areas including gender quota breaches and implementation of and compliance with the law.7 In accordance with this instruction, on February 8, 2012, Consob issued a final rule that introduced a new Article 144-undecies.1 in the Consob Regulation No. 11971 of May 14, 1999.  This rule requires public company bylaws to include:

  1. the criteria for the formation of the slates of candidates and ancillary criteria for identifying individual members to the board of directors and board of statutory auditors designed to create a balance between genders (recognizing that bylaws shall not require slates with fewer than three candidates in order to respect the criterion of balance between genders); 8
  2. taking into account the gender balance goal, the procedures for replacing members of the board of directors and board of statutory auditors in the event of vacancies; and
  3. procedures for exercising the rights of appointment in a way that does not conflict with the goal to keep balance between genders.

Corporate Governance Code

The Italian Stock Exchange, the Borsa Italiana S.p.A. stock exchange (the “Borsa”), also addresses the issue of gender balance on corporate boards in its “Public Companies’ Corporate Governance Code,” most recently modified in July 2018 (the “Italian Corporate Governance Code”). In particular, the Italian Corporate Governance Code was amended in July 2018 to “safeguard the positive effects of the” Gender Parity Law.9 The amendments address each of the three sections of the Code: principles, criteria, and comment. The first, amended “principle” section recommends companies apply diversity criteria, inclusive of gender diversity, to the board of directors and board of statutory auditors. The second, criterion section suggests a one-third quota of the lesser represented gender on boards, on a voluntary basis, designed to have the effect of “promoting the preservation” of the Gender Parity Law. The third, comment section provides a number of tools designed to achieve the one-third quota, including bylaw provisions, diversity policies, and board guidelines to shareholders, among others.

The Italian Corporate Governance Code also requires that boards of directors conduct self-assessments, with particular reference to the size, composition, and functioning of both the entire body and its committees.  In evaluating its composition, the board must verify that all different members as well as professional and managerial skills are adequately represented, “taking into account the benefits that may result from the presence on the board of different gender, age and seniority.”10

Consob Study on Women on Boards in Italy 

In October 2011, just a few months after the introduction of the Gender Parity Law, Consob published “Women on boards in Italy,” a case study investigating the state of women’s representation on Italian corporate boards (the “Consob Study”). The Consob Study is the first paper issued by Consob addressing the relationship between women’s representation on boards and good governance and performance results.11Since that time, Consob has authored additional studies regarding board performance in Italy; diversity has been addressed in both studies and is discussed below as indices of progress.

According to the Consob Study, the female presence on boards “still concerns the minority of companies (mainly the smaller ones). When women are present, in most cases they are alone.12 In particular, the research shows that the participation of women in Italian boardrooms is often due to family ties with the controlling shareholder (“Family-Affiliated Women”).13 Moreover, an analysis of the composition of boards revealed that:


The changes based on the Gender Parity Law did not occur all at once as only around one third of public companies were expected to renew or reappoint directors and statutory auditors in 2012, and therefore, were required to implement the 20% threshold in 2013.  For the remaining public companies subject to the Gender Parity Law, the boards of directors and boards of statutory auditors expired either in 2013 or in 2014. Therefore, those companies were required to implement the 20% threshold in 2014 and 2015, respectively.

Progress has been dramatic since implementation of the Gender Parity Law.  Companies in Italy now have a higher share of female directors, the average education level of the board as a whole has increased, and the ages of the directors are now lowered.14   The share of women on boards improved 13.3% between 2013 and 2016, to over 30%.15   At the end of 2016, foreign directors composed 10% of executive director positions and 15% of non-executive director positions.16

As of June 2017, Consob reported that women represent over one-third of all board members; this figure is the highest ever recorded in Italy.17   Furthermore, each company that has undergone a second or third renewal of its board under the Gender Parity Law has exceeded the one-third share quota.18   In the majority of newly listed companies, women account for twenty-nine percent of the boards.19  


Beginning in 2010, the issue of gender representation in boardrooms was given a high priority in Italy. After the introduction of the Gender Parity Law, public companies are now obligated to comply with the 30 % threshold with each renewal of their boards of directors and boards of statutory auditors.  The result has rippled throughout the country.  Interestingly, since the increase in numbers of female directors, there has been a reduced variability in the stock price of these Italian companies.20  

But for those companies whose first renewal occurred in 2012, the third term is approaching.  As the Gender Parity Law begins to expire, it remains to be seen if this approach was successful at reforming culture, or if companies only complied due to the legal requirements thrust upon them.  The most recent Consob report pointed to the former, with women holding an average of three seats on newly listed companies not subject to the Gender Parity Law.21   Hopefully future director appointments will continue that narrative, particularly under the guidelines set forth by the Borsa in its latest revisions of the Italian Corporate Governance Code.

1        Cerved, “Le donne al comando delle imprese: il fattore D,” Mar. 2009.

2       More women in senior positions, key to economic stability and growth, European Commission, Directorate-General for Employment, Social Affairs and Equal Opportunities, Unit G1, 2010.

3        Specifically, the Italian Chamber of Deputes enacted it, in its final vote, with a deliberation comprising 438 votes in its favor, 27 against it and 64 abstainers.

4        The Gender Parity Law was signed by the President on July 12, 2011 and went into effect on Aug. 12, 2011.

5        The Gender Parity Law is not applicable to private companies nor have any other laws on gender parity been proposed with regard to private companies.

6        Commissione Nazionale per la Società e la Borsa (Consob) is the Italian equivalent of the United States Securities and Exchange Commission (SEC).

7        Under Italian law, Consob has the power to enact regulations on specific aspects when legislative measures do not entirely regulate all matters regarding public companies or when the specific knowledge of Consob on financial markets is required for a detailed regulation of the matter.

8     Under the draft rule, if, as a result the implementation of the criteria noted in (i) above, the numbers of directors or statutory auditors of the underrepresented gender is not a whole number, such number shall be rounded up.

9     Press Release, Italian Corporate Governance Committee, New Corporate Governance Code Recommendations on Diversity, Including by Gender, for Listed Companies (July 17, 2018),

10     Id. at Comment to Article 1.

11     In particular, from the Consob Study it results that “female directorship is associated to some characteristics of firms and of women themselves, depending in particular on whether they are related (through family links) to the controlling agent. Two very different models emerge. On the one hand, family affiliated women are more present in smaller companies, with a concentrated ownership operating in the consumers sector. On the other hand, not-affiliated women are more common in widely held companies or in firms owned by a foreign shareholder, in the IT/telecommunication sector, and in companies with younger and more independent boards. In both models the presence of institutional investors and board size positively affect female representation”. See for more reference

12     However, according to the Consob Study, both the number of female directors and that of companies where at least one board member is a woman are steadily (but slowly) growing.

13     It is also worth mentioning that the proportion of women with graduate degrees is much higher in companies without Family-Affiliated Women directors as compared to companies with Family-Affiliated Women directors (95% vs. 60%).

14     Giulia Ferrari et al., Gender Quotas: Challenging the Boards, Performance, and Stock Market, IZA Discussion Paper 10239 5 (Sept. 2016),

15 The level of women on boards as of September 2016 was 30.8%.  Women in the boardroom: A global perspective, Deloitte 59 (2017),

16 A. Ciavarella, Board Diversity and Firm Performance Across Europe, Commissione Nazionale per la Società e la Borsa (Dec. 2017), 

17 Report on Corporate Governance of Italian Listed Companies, Commissione Nazionale per la Società e la Borsa 16 (Dec. 2017),

18 Id. Consob reports that companies that have undergone two board renewals have 36.5% female directors, and companies who have undergone two board renewals have 38.7% female directors.

19 Id.

20 Ferrari et al., supra note 14, at 5-6.

21 Report on Corporate Governance of Italian Listed Companies, supra note 17.