Board Directors' Selection Process Following a Gender Quota

The 2008 financial crisis in Iceland was triggered by poor governance of three of the country’s major banks and resulted in new corporate governance regulations including a 40% gender quota for the boards of all state-owned enterprises, publicly traded enterprises, and public and private limited companies with 50 or more employees. Thereby legislatively going further than any other country, out of the fifteen that have amended and adopted gender quota legislation. This article utilizes resource dependency and status expectations theory lenses to explore how the new legislation affected the post-quota selection of new board directors as well as the attitudes of board members towards the quota and perceptions of the effect of quota on processes. We incorporate a dual qualitative and quantitative methodology with in-depth interviews with 20 board directors and chairs, and a survey of 260 directors who collectively hold 800 board directorships in Iceland. We find that the post-quota, post-crisis new directors are sought for a variety of skillsets, including general management experience, policy-making, and finance, as well as personal characteristics of strong moral sense and ability to stand by your own conviction. Furthermore, there are different avenues to the board. Although initial attitudes towards quotas are more negative among men than women, these attitudes decrease over time. Finally, consistent with status expectation theory, male directors are more negative than their female counterparts about the short-term effects of the quota.