The Gender Representation on Public Boards (Scotland) Bill 2017
Although women make up over 51% of the population in Scotland,[1] they are under-represented in political, civic and public life, and in senior decision making positions in the public and private sector. Women hold only 35% of positions in the Scottish Parliament, 31% of the House of Commons, 29% of local government councillors in Scotland, and 24% of public board chairs.[2] To address this issue, on 15 June 2017 the Cabinet Secretary for Communities, Social Security and Equalities introduced the Gender Representation on Public Boards (Scotland) Bill to the Scottish Parliament. The Bill aims to redress the gender imbalance on the boards of public bodies by setting a gender representation objective of 50% for the non-executive members, and requiring positive action to encourage non-executive board applications by women.
The Bill is not the first effort of the Scottish Government to redress the gender imbalance in public authorities. In September 2008, the Commissioner for Public Appointments in Scotland issued an equal opportunities strategy for ministerial public appointments.[3] The strategy’s main aim was to raise public awareness about the importance of diversity in public bodies, and to reach out to a diverse pool of potential candidates for public appointments, with a particular focus on under-represented groups such as women, people from a minority ethnic background, LGBT people and disabled people. It urged public authorities to promote gender equality in their appointments, and to monitor the gender profile (among other characteristics) of their applicants. Several years later, in April 2014, the Scottish Government launched a public consultation on the introduction of mandatory quotas of 40% of women representation on public boards.[4] The consultation also asked whether gender diversity quotas should be extended to company boards. This initiative did not lead to legal reform, as at that time the Scottish Parliament lacked the legislative powers to address this issue. The 2017 Bill was made possible by the Scotland Act 2016, which transferred competence to the Scottish Parliament to legislate on equal opportunities in relation to non-executive director appointments to the boards of Scottish public authorities.[5]
The Bill is a key commitment of the Scottish Government under its 2016-17 Programme.[6] It sits alongside the ‘Partnership for Change Pledge – 50:50 by 2020’ campaign announced in the 2014-15 Government Programme[7] and launched in June 2015. The campaign encourages public, private and third sector organisations to sign up to the Partnership for Change pledge and to set a voluntary commitment for board gender balance of 50:50 by 2020. The campaign has proven very successful so far, with over 90% of public bodies having taken the pledge.[8] The same Government Programme introduced the Scottish Business Pledge, an invitation to Scottish businesses to commit to fair and progressive business practices.[9] Signatories to the Business Pledge undertake, among other commitments, to make progress on gender diversity by putting in place progressive policies and practices. Businesses are encouraged to assess how their organisational culture supports diversity in the workforce, by using the Think Business, Think Equality self-assessment tool.[10] As at 2 June 2017, 371 businesses (representing a meagre 0.2% of the Scotland’s registered business base) had signed up to the Business Pledge.[11]
If the Bill passes, it will become part of a broader legal framework relevant to public sector board diversity. Under the Equality Act 2010, a public authority must, in the exercise of its functions, have due regard to the need to eliminate discrimination, to advance equality of opportunity and to foster good relations between people who share a protected characteristic and those who do not (the ‘public sector equality duty’).[12] The Equality Act 2010 (Specific Duties) (Scotland) Regulations 2012, as amended in 2015 and 2016, require Scottish Ministers to gather information on the relevant protected characteristics of board members of a listed authority, and to provide this information to the listed authority in question. The listed authority must use this information to better perform the public sector equality duty.[13] Moreover, listed authorities must publish every two years a mainstreaming report including details on the steps they plan to take across all relevant protected characteristics to promote diversity in their members.[14] Diversity provisions exist also with regard to appointment and succession of public sector board members. As regards appointments, the Commissioner for Ethical Standards in Public Life in Scotland issued in October 2013 a revised Code of Practice for Ministerial Appointments to Public Bodies in Scotland.[15] The revised Code stipulates three core principles underpinning public appointments in Scotland: merit, integrity, and diversity & equality. The latter principle requires that public appointments be advertised in a way that will attract a strong and diverse field of suitable candidates. As regards board succession, in January 2017, the Scottish Government issued a set of guidelines on succession planning for public body boards.[16] The guidance highlights diversity in relation to board members’ protected characteristics as a key issue central to a board’s approach to succession planning.
The content of the Bill
The Bill sets a board gender representation objective of 50% women non-executive directors to be achieved by 31 December 2022.[17] To attain this goal, the relevant appointing person must give preference to a woman candidate when there are two or more equally qualified candidates.[18] Exceptionally, when multiple equally qualified applicants exist, the appointing person may give preference to a candidate who is not female, if this is justified on the basis of a characteristic or situation particular to that candidate.[19] In addition to the tie-breaker provision, the Bill imposes on the appointing person or public authority several duties regarding the appointment process. First, they must take appropriate steps to encourage women to apply for non-executive board positions.[20] Second, whenever the gender representation objective is not achieved, they must take other appropriate steps with a view to achieving it by the 2022 deadline.[21] Third, certain public authorities must publish reports on their progress towards the objective, as instructed by regulations to be adopted by the relevant Scottish Ministers.[22]
The gender representation objective covers non-executive board members only. A ‘non-executive member’ is defined as a person who is not an employee of the public authority. Schedule 1 also specifies other members of the relevant public authority who are excluded from the Bill (for example, because they are elected rather than appointed to the board). The ‘appointing person’ envisaged by the Bill refers to a person who has the authority to appoint a non-executive member of a public board. In most cases, such person is the relevant Scottish Minister, deciding on the basis of recommendations from an appointing panel.[23] Examples of other appointing persons include the Lord President, for the Judicial Appointments Board for Scotland, or the Scottish Parliamentary Corporate Body, deciding for the Standards Commission for Scotland.[24] The ‘public authorities’ covered by the Bill are listed in Schedule 1. They include entities such as a college of further education (within the meaning of the Further and Higher Education (Scotland) Act 1992), a health board constituted under section 2(1)(a) of the National Health Service (Scotland) Act 1978, a regional transport partnership created under section 1(1) of the Transport (Scotland) Act 2005, the Scottish Social Services Council, the National Library of Scotland, the Board of Trustees for the National Galleries of Scotland, the Board of Trustees of the Royal Botanic Garden of Edinburgh, and Revenue Scotland. In addition, Schedule 2 of the Bill sets out special provisions for the Judicial Appointments Board for Scotland, the Regional Board for Glasgow Colleges, regional colleges, and the Scottish Criminal Cases Review Commission.
Reactions to the draft Bill
The initial draft version of the Bill was published on 5 January 2017. Between January and March 2017, the Scottish Government held a public consultation, seeking views on the content and application of the Bill.[25]
One of the main issues flagged up by the respondents was the binary definition of gender used in the draft Bill. In its initial version, section 1 defined the gender representation objective as achieving a board having ‘50% of non-executive members who are female or who identify as female’ and ‘50% of non-executive members who are male or who identify as male’. Respondents commented that the language in this section was not inclusive of people who do not identify as either a man or woman. Women 50:50, for example, suggested that a more inclusive gender representation objective would be 50% of females/persons who identify as female, and 50% of males/persons who identify as males or do no identify within a gender binary. The Scottish Legal Complaints Commission pointed out that the gender binary definition of the objective could force public authorities to categorise applicants as either male or female, in order to apply the tie-breaker provision. To avoid this, Stonewall Scotland suggested that the Bill clarify that where a non-binary person is equally qualified as other candidates, they may be appointed under the ‘exceptional circumstances’ clause. A binary definition of the gender objective may also be inconsistent with the Scottish Government’s commitment to consult on reforming the Gender Recognition Act 2004, with a view to bring in it line with best international practice.[26] Other respondents observed that the ‘male/identify as male’ and ‘female/identify as female’ may not be sufficiently inclusive of trans people. Close the Gap pointed out that, since ‘female’ and ‘male’ are used to describe biological sex, rather than gender identity, it would be more inclusive of trans persons to use ‘woman’ and ‘man’ throughout the Bill. Stonewall Scotland commented that female (male)/identify as female (male) creates an unnecessary distinction between cis and trans persons, which could have a detrimental impact on persons who share the protected characteristic of gender reassignment. As a result of these views, the Government amended the draft Bill by removing the male/female terms and redefining the objective as ‘50% of non-executive members who are women’.
Another common suggestion was that the appointment and outreach provisions of the Bill must make greater consideration of intersectionality. The Coalition for Racial Equality and Rights observed that a narrow focus on gender may potentially inhibit diversity as a whole, rather than improve it. A narrow approach may result in candidates with disabilities or belonging to a minority ethnic group not being offered a position in order to achieve a 50/50 gender objective. Similarly, Queen Margaret University commented that the emphasis on gender and the highly prescriptive requirements of the draft Bill may have the unintended consequence of discriminating against candidates with other protected characteristics. Although the Scottish Government did not amend the draft Bill to cover other protected characteristics, it stated in the Impact Assessment review that it is ‘prioritising work’ to address the under-representation of other groups in public sector boards.[27] It also observed that the promotion of women gives public authorities the opportunity to test their board recruitment processes and make them more inclusive of all potential candidates, irrespective of their protected characteristics.[28]
Finally, respondents highlighted the need for including reporting duties. Women 50:50 called for an obligation of public authorities to disclose their strategy to reach gender parity, including timescales and individual responsibilities. Furthermore, the Bill should provide for a Government duty to monitor the overall progress towards the objective and report to the Scottish Parliament. Close the Gap argued for reporting obligations aligned with existing reporting regulations and timescales under the public sector equality duty. Another respondent noted that the list of bodies covered by the draft Bill and those subject to the Equality Act Regulations do not overlap completely, and suggested reporting obligations covering only institutions not already subject to the public sector equality duty. In response, the Bill was amended to include a reporting duty the details of which are to be determined under regulations adopted by the Scottish Ministers.
Concluding remarks
The public debate that followed the publication of the draft Bill highlights the complex issues arising when the need to design effective boards intersects the need to advance equality of opportunity for people sharing a protected characteristic. The focus of the board diversity debate appears to have moved away from the desirability of board diversity to the need to reconcile promotion of gender diversity and intersectionality. The main arguments in support of gender diversity, such as the need to recruit from the widest possible talent pool, the need to have a greater understanding of all relevant stakeholders, or the superior board decision-making process, are ultimately arguments for diversity in its widest sense. At the same time, insights form corporate governance and strategic management show that boards of directors function better when they are relatively small and have a certain degree of cohesion that facilitates development of trust and celerity. The real challenge in making board diversity work resides perhaps not so much in achieving a fair representation of the diverse stakeholders relevant to a particular organisation, as in identifying and implementing decision-making processes that would allow a diverse board to function efficiently.
[1] National Records of Scotland, “Mid-Year Population Estimates Scotland, Mid-2016” (27 April 2017), available here.
[2] Scottish Government, “Gender Representation on Public Boards (Scotland) Bill EQIA Results Template” (June 2017) pp 3-4, available here.
[3] Office of the Commissioner for Public Appointments in Scotland, “Diversity Delivers: A strategy for Enhancing Equality of Opportunity in Scotland’s Ministerial Public Appointments Process” (September 2008), available here.
[5] 2016 c. 11. S 37(3) of the Act transfers competence to the Scottish Parliament to legislate on equal
opportunities “so far as relating to the inclusion of persons with protected characteristics in non-executive posts on boards of Scottish public authorities with mixed functions or no reserved functions.” The protected characteristics under the Equality Act 2010 are: age, disability, gender reassignment, marriage and civil partnership, pregnancy and maternity, race, religion or belief, sex, sexual orientation (2010 c.15 s.4).
[6] Scottish Government, “A Plan for Scotland: The Government’s Programme for Scotland 2016-17” p. 12, available here.
[7] Scottish Government, “One Scotland: The Government’s Programme for Scotland 2014-15” p. 28, available here.
[8] Scottish Government, “Gender Representation on Public Boards (Scotland) Bill EQIA Results Template” p. 4.
[10] Available here. This online self-assessment test is developed by Close the Gap, a charity funded by the Scottish Government.
[11] Scottish Business Pledge, “Statistical Overview June 2017”, available here.
[12] Equality Act 2010, 2010 c.15 s 149.
[13] The Equality Act 2010 (Specific Duties) (Scotland) Regulations 2012, regulation 6A.
[14] Ibid. regulations 3 and 6A.
[17] S1 and s6.
[18] S 4(3).
[19] S 4(4).
[20] S 5.
[21] S 6.
[22] S 7.
[23] SCG 9.
[24] SCG 9.
[25] The published responses are available here.
[26] Scottish Government, “A Plan for Scotland: The Government’s Programme for Scotland 2016-17” p. 77.
[27] Scottish Government, “Gender Representation on Public Boards (Scotland) Bill EQIA Results Template” p. 5.
[28] Ibid.