Spotlight on Italy

Across nearly every measure of progress, Italy is highly successful when it comes to gender balance in the boardroom. But it hasn’t always been this way. This outcome can be largely attributed to the Gender Parity Law enacted in 2011 requiring a share of 30 percent of female representation in the boardroom of public companies traded on the Italian Stock Exchange, EU stock markets and Italian state-owned enterprises. In 2020, the rule was further amended to expand gender balance requirements to 40 percent and to add mechanisms to balance compensation, add maternity protections, and embed other components to ensure equal opportunities.

In 2022-2023, the Tracker encompasses 18 Italian companies with a market cap of €8 billion and above. The nation is part of our Western European group, with a total of 395 companies across 17 nations (Austria, Belgium, Denmark, Finland, France, Germany, Greece, Italy, Luxembourg, Netherlands, Norway, Portugal, Republic of Ireland, Spain, Sweden, Switzerland, and the United Kingdom). Globally, our full study analyzes 44 nations.

Large Italian company boards have a high representation of women, with 100 percent of them encompassing female directors (22.2 percent having three and 77.8 percent with four or more). These numbers reflect that quotas can be an effective tool to advance women in leadership. In 2010, before the rule was enacted, the share of boards with at least one woman was much lower at 66.7 percent.

This notable share of female representation in the boardroom is on pair with other Western European nations included in the Tracker, where the average share of boards with at least one woman is 99.7 percent. Globally, 93 percent of all large company boards include at least one woman, but this number drops significantly to 59.8 percent when we increase the amount of female directors to at least three or more per board.

Italy surpasses all other countries when it comes to progress of female board members. In just a decade, female representation in board seats increased 32 percent—now, women hold 40.4 percent of board seats.

The nation belongs to a small group of four where women hold more than 40 percent of seats, alongside France (45.3%), Norway (40.7%) and New Zealand (45.6%).

Every transformation comes with its own challenges, and it can be especially daunting to implement gender quotas that go against the establishment. But positive results lay bare how critical it is to intentionally promote women’s advancement in leadership positions. In 2010, only 5 percent of Italian board seats were held by female leaders, as the graphic below highlights. Was there a lack of qualified women before? Or were these executives not considered for board opportunities at the same level as their male counterparts? Perhaps the country would still advance its female leaders without the quota policy, but the law certainly helped to remove barriers that slowed down progress.

Quotas Unlock Female-Held Boards Seats in Italy Boards seats held by women, 2010 to 2022

This emphasis in increasing greater gender representation doesn’t only look good on paper. Female board directors add significant contributions that enhance company performance, so it’s important to not lose sight of efforts. Despite standing out on the share of female-held seats, only 26.1 percent of new hires were female, down from 39.3 percent in 2020.

Additionally, while board representation progress is remarkable, Italy grapples with the gender balance when it comes to those who rise to the CEO and CFO positions—largely represented by men. Because these experiences are often required for boardroom eligibility, this barrier will take time to overcome. From the sample we analyzed, there currently are no female CEOs—down from 5.3 in 2020; and only 12.5 percent of CFOs are female—down from 28.6 percent in 2020.

Women have landed an unprecedented share of board seats in Italy in the past decade. Now, a critical next step is to diversify board leadership positions. None of the boards analyzed have had an executive female chair since 2014 (as far as our data goes back), and the share of non-executive female chairs is 38.5 percent, down from 41.7 percent in 2020. On the other hand, representation is almost even in board committee chair positions. Women hold 47.8 percent of seats, up from 40 percent in 2020. Ten years ago, only 7.8 percent of committee chair roles were held by female directors. Comparing to global numbers, the average share of female committee chairs is well below the Italian mark (25%).

While every seat on a board is highly impactful, leadership seats carry additional responsibility and influence, so it is important to bring diverse perspectives into the leadership level of a board. This is where the chair can step in to create a diverse pipeline of board leaders by adopting an inclusive framework for board leadership succession.

Beyond gender diversity, more than 8 in 10 Italian boards have a non-national director (83.33%). Non-national board directors correspond to 18.3 percent of all seats in Italy—and out of these, 16.3 percent are women. Female directors are even more likely to have international backgrounds, as the Italian example illustrates. This may be due to heightened demand for gender diversity, leading boards to hire new directors more internationally to encounter the short supply of women in top leaderships in own markets.

In Western Europe, 91 percent of boards now include at least one director from a country other than where the company is headquartered—globally, the share is 73 percent of boards. This corresponds to 25 percent of all directors globally, and 39 percent of all directors in Western Europe being non-nationals.

During the coronavirus pandemic, international directorships were proven even more effective. And it proved that having different nationalities didn’t require physical presence as directors didn’t have to embark on a flight to Milan, for instance. However, it may yet be too soon to determine if this virtual reality will have a long-lasting impact on the decision to onboard a non-national director. Nonetheless, companies are making efforts to add these directors because they bring an important perspective.