Corporate Governance

BOARD GENDER BALANCE REGULATIONS

The European Union (Gender Balance on Boards of Certain Companies) Regulations 2025 (the Regulations) transpose the EU Gender Balance on Boards Directive into Irish law, establishing new measures to address gender balance on the boards of large EU listed companies.

Companies in Scope

The Regulations apply to a “relevant listed company”, an Irish incorporated company which:

• is not a “micro, small and medium-sized enterprise or SME” (defined as a company that employees less than 250 persons and has an annual turnover not exceeding EUR 50,000,000 or an annual balance sheet total not exceeding EUR 43,000,000);
• has its registered office in Ireland; and
• has shares admitted to trading on an EU regulated market.

The Regulations do not apply to Irish companies with shares listed on a US and/or UK market, where they do not have shares admitted to trading on an EU regulated market.

The Directive and the Regulations, as currently drafted, apply to a listed company that is not an SME. Since the relevant thresholds apply on individual rather than a consolidated basis, a listed holding company without direct employees or operations may technically fall outside the scope of the Regulations. It is not clear that this was the legislative intent, and it is possible that the Minister is envisaging compliance from issuers who satisfy the thresholds on a consolidated basis, and that investors and proxy advisers will also assess compliance in this way. As a result, notwithstanding the narrower application, issuers may elect to consider themselves an “in-scope company” for the purposes of the Regulations.

Gender Balance Objectives

Non-Executive Directors

By 30 June 2026 in-scope companies must ensure at least 40% of non-executive directors are members of the “underrepresented sex” (the NED Objective).

Executive Directors

By 30 June 2026 in-scope companies must: (1) set written individual quantitative objectives to improve the gender balance amongst executive directors; and (2) specify the steps that the company has taken or is taking towards achieving these objectives. This information must be published on the company’s website by 30 November 2026.

Selection Process

In-scope companies that fail to achieve the NED Objective by 30 June 2026 must adjust their selection process for appointment or election as non-executive directors so that clear, neutrally formulated, and unambiguous criteria are applied. Where the NED Objective has not been met and candidates are equally qualified in terms of suitability, competence, and professional experience, priority should be given to the candidate of the underrepresented sex. This requirement can be overridden in exceptional cases where reasons of greater legal weight, grounded in non-discriminatory considerations (such as other diversity criteria) justify an alternative appointment. Where the candidate of the underrepresented sex is not given priority in such circumstances, the company must document its rationale to the Minister.

An in-scope company that has not met the NED Objective must document its compliance with the adjusted selection process and the obligations regarding the selection of candidates. This documentation must be completed by 30 November 2026 and on an annual basis thereafter and a copy must be provided to the Minister.

A candidate who was considered for election as a non-executive director may also make a written request to the company for certain information in relation to the selection process.

In addition, companies that do not meet the NED Objective must inform shareholders in advance of a vote to appoint a non-executive director of the measures provided in the Regulations, including the penalties for non-compliance. A copy of this information must also be provided to the Minister.

The Regulations do not expressly address the circumstances in which an in-scope company achieves the NED Objective by the 30 June 2026, but the board composition subsequently changes to fall below the threshold at a later date (for example, if a female NED retires reducing the gender balance below 40%).

Annual Reporting

All in-scope companies must report annually to the Minister, by 30 November each year, commencing from 30 November 2026 (the Publication Date) on the gender representation of its board distinguishing between executive and non-executive directors, by uploading the information to a website to be designated by the Minister. Companies must also report to the Minister, in a form and manner to be specified, on the measures taken with view to reaching achieving the NED Objective and the individual quantitative objectives for executive directors.

Where a company has not achieved the NED Objective and the individual quantitative objectives for executive directors, the company must also report the reasons why it did not achieve those objectives and a description of the measures taken or intended to be taken to achieve the objectives.

This information must also be published on the company’s website and included in the company’s next corporate governance statement following the Publication Date and a copy of the corporate governance statement must be submitted to the Minister.

Non-Compliance

Commencing from 1 December 2027, the Minister will publish annually, on a designated website, the name of each in-scope company that has failed to comply with specified documentation, publication, or reporting obligations set out in the Regulations.

Practical Considerations

The Regulations impose new, substantive Irish legal obligations on in-scope companies in relation to the gender composition of the board. This is a change for in-scope companies who previously had more flexibility on diversity matters - Irish listed issuers currently explain their diversity policies in their annual reports and/or follow gender-based targets on a voluntary basis (such as those recommended by proxy advisors).

In-scope companies need to take steps now to plan for the application of the Regulations, notably to consider the steps they need to take to report on the gender composition of their board in 12 months’ time as at 26 June 2026 (for first reporting in November 2026). This will likely include assessing corporate governance frameworks to ensure effective monitoring of board gender composition and a succession plan that supports a pool of suitably qualified female candidates. The NED Objective should also be considered in the context of ongoing or new non-executive directors appointments over the next 12 months.

In-scope companies should also update checklists and timetables to ensure information under these regulations will be disclosed in a timely manner, including the 30 November annual reporting date, as well as information to be included in the corporate governance statement in the annual report, and, if applicable, information on the appointment of non-executive directors in the AGM notice.

UK STEWARDSHIP CODE 2026

The Financial Reporting Council (FRC) published the UK Stewardship Code 2026 which will take effect from 1 January 2026. The Stewardship Code is a voluntary code comprising a set of ‘comply or explain’ Principles for asset owners, asset managers and service providers. Organisations to which the Code applies must submit an annual stewardship report to the FRC explaining how they have applied it in the previous 12 months.

First applications to the new Code will be accepted in Spring 2026. To support signatories in adapting to the new Code, a transition year will operate during 2026 during which no existing signatories will be removed from the signatory list.

The FRC has also published draft new optional guidance to accompany the Code which remains open for comment until 31 August 2025. The guidance will be finalised this autumn.

More information:

FRC overhauls the Investor Stewardship Code to focus on value creation, reducing burdens and enhanced engagement between market participants.

UK Stewardship Code 2026 at a glance.