The European Directive on Gender Balance on the promotion of gender balance among the directors of listed companies – How Will It Apply in the Republic of Moldova?

The Ministry of Labor and Social Protection has published for public consultation a draft law amending Law No. 1134/1997 on Joint Stock Companies, with the objective of strengthening gender balance in the management bodies of companies traded on a regulated market.This initiative transposes into national law Directive (EU) 2022/2381 of the European Parliament and of the Council of 23 November 2022 on the promotion of gender balance among the directors of listed companies. The European Directive aims to accelerate progress toward equal opportunities by introducing concrete and effective measures, while allowing companies sufficient time to adapt.

What the draft law proposes

The draft law proposes the introduction of mandatory minimum quotas for the representation of the underrepresented gender:

• At least 40% of the non-executive director positions; or
• At least 33% of all director positions, including both executive and non-executive directors.

Companies will have the freedom to choose which of these quotas to apply, thereby ensuring greater flexibility in the compliance process. Companies opting for the 40% quota will be required to set clear quantitative objectives to achieve gender balance by January 1, 2028.

The Directive and the draft law do not concern the shareholding structure but focus exclusively on the composition of management bodies, the company’s board and executive body. Accordingly, the General Meeting of Shareholders or, as applicable, the company’s board must observe gender balance principles when electing members of the management bodies. Candidate selection will be based on professionalism, competence, and performance, and in cases of equal qualifications, preference will be given to the candidate belonging to the underrepresented gender. The number of positions required to meet the quota will be calculated proportionally (closest to 40% or 33%, without exceeding 49%).