Kristina Bjørkedal Vågnes
Senior Associate
Oslo
Newsletter
Gender balance requirements in the board of directors – is your company compliant?
by Kristina Bjørkedal Vågnes and Marie Berggren Hagberg
Published:
With effect from 1 January 2024, new legislation was introduced in Norway that extends the number of companies that are subject to gender balance requirements in their board of directors. The rules apply to companies that either have a total operating and financial income above NOK 50 million, or who have more than 30 employees.
The change in legislation means that both board members appointed by the General Assembly and board members elected by the employees may be subject to gender balance requirements, based on two separate assessments:
- For board members appointed by the General Assembly, a gender balance requirement applies if three or more members are to be appointed. The legislator has described separate thresholds with the maximum number of board members who may be appointed with the same gender. These thresholds also apply to any deputy board members appointed by the General Assembly.
- For board members elected by the employees, a gender balance requirement also applies if three or more members are to be elected. However, if a company has a gender balance amongst its employees whereby more than 80% are of one gender at the election date, the gender balance requirement for the employee elected board members will not apply.
The legislator has implemented a transition scheme, allowing for different deadlines for implementation depending on each company's revenue and number of employees. Companies with revenues exceeding NOK 100 million or who has more than 50 employees are already expected to be compliant with the new rules.
The next relevant deadline for implementation is applicable for companies that as of the financial year-end date had 30 employees or more. For these companies, the board of directors shall be compliant with the gender balance requirements for the members appointed by the General Assembly by 30 June 2026. For employee-elected board members, the gender balance requirement must be adhered to in the first election process following this deadline. That being said, it is unlikely that a separate gender balance requirement will apply for employee-elected board members in companies who employ between 30 and 50 employees.
We also note that for companies with fewer than 30 employees, the deadline for compliance will depend on their revenue. If their revenue exceeds NOK 70 million, the board composition must be compliant with the gender balance requirement by 30 June 2027. If their revenue exceeds NOK 50 million, the deadline for compliance is set to 1 July 2028.
