Yves Mersch, the head of Luxembourg’s Central Bank was appointed to the European Central Bank’s Executive Board to replace Jose Manuel Gonzalez-Paramo of Spain, who recently retired. However, the European Parliament, in a charge led by Sharon Bowles (chair of the European Parliament’s Economic and Monetary Affairs Committee), has postponed Mersch’s appointment due to what Bowles characterizes as a bias against women appointments to the board. At the moment, there are no women serving on the executive board and there have been two women, Getrude Tumpel-Gugerell of Austria and Sirkka Hämäläinen of Finland, to serve on the executive board in the past. Bowles has been quoted as saying “the symbolic and practical effects of this absence are not without note” as illustrated by her push to address this issue. Currently, there is no law in place that would allow the European Parliament to completely block the nomination of Mersch, however the Parliament “must give an advisory opinion on the suitability of candidates.” (http://www.google.com/hostednews/ap/article/ALeqM5gTlvN-fP3kYlGwL4ywzw1MQ-lh0A?docId=6efa583b79044e23931b76cecc96a116).
In May of 2012, Bowles stated that she wrote to Jean-Claude Juncker, Prime Minister of Luxembourg and head of the Euro group of euro zone finance ministers, requesting that at least one woman candidate be considered, but Bowles contends that she never received a “formal response” from the prime minister. (http://blogs.ft.com/brusselsblog/2012/09/yves-mersch-is-male-is-that-now-a-problem-for-ecb/#axzz25oUedEBp). In the midst of this issue, the European Commission has also been expected to propose legislation placing a mandatory quota requiring 40% of corporations’ board members to be female, where failure to adhere to this proposed quota would result in fines and sanctions.
It is clear that government officials throughout Europe feel there is a cultural problem with a lack of gender equality present on executive boards. Where it may be a problem in many corporations, I do not believe that it is as severe in the case with the ECB executive board. The board has had a woman member in every year of its existence until last May when Tumpel-Gugerell left the board. However, government officials clearly view this as a problem. With that being said, I do believe there are other avenues that may alleviate this discrepancy. Personally, I would not impose a strict quota because I believe that the best candidate should be chosen regardless of gender. With that in mind, perhaps a law requiring at least one-woman candidate to be considered before a nomination is made would work to increase the female presence on the board. This type of regulation has proved to have a positive impact in the National Football League, where the “Rooney Rule”, which requires that at least one minority head coaching candidate be considered before a new head coach is selected, has increased the amount of minority head coaches throughout the league. Perhaps, by incorporating this type of regulation into the selection of ECB executive board members, the amount of women on the board would increase.
With the current situation as it is it will be interesting to see what possible changes could be made and the possible results of this pressure being placed on the ECB by the European Parliament. Please consider the questions listed below.
-Do you believe that the postponement is an appropriate measure to be taken?
-Similar to the mandatory quota to be proposed next month for publicly listed corporations, should there be a similar law proposed to ensure strong women representation on the ECB’s executive Board?
-Should the European Parliament have a law in place allowing them complete power to block a nomination?