New Rules for Gender Balance in Corporate Boards Amendments to Greek Governance Law 4706/2020

Ι.Introduction

As of December 28, 2024, the Gender Balance on Corporate Boards Directive (EU 2022/2381) has entered into force, marking a significant milestone in the European Union’s commitment to achieving equality in corporate leadership. The Directive introduces mandatory representation targets for the underrepresented gender on corporate boards across the EU, emphasizing the need for balanced decision-making in leadership structures. By ensuring that at least 40% of non-executive directors or 33% of all directors in listed companies are held by the underrepresented gender, the Directive aims at breaking long-standing barriers to gender equality in the corporate world.

Greece is at the forefront of implementing this transformative initiative, taking significant steps to align its national legislation with the Directive. Building on the foundations of the Greek Governance Law 4706/2020, which already has set a precedent for promoting gender diversity in corporate leadership, Greece is set to enhance its governance framework to meet the EU-mandated standards. As of 14 February 2025, the new law 5178/2025 (Government Gazette A’ 22/14.02.2025) has been adopted, introducing amendments and additional provisions to the existing Law 4706/2020. Companies must carefully assess and implement these new provisions to ensure full compliance with the updated regulations.

II. Existing provisions for gender balance

Under the existing provisions of the Greek Governance Law 4706/2020, Greek listed companies are required to adopt a suitability policy for the members of their Boards of Directors (BoD). Article 3 of the law stipulated that this policy must include criteria for assessing the suitability of BoD members, with a particular emphasis on achieving adequate gender representation. Specifically, the law mandated that at least 25% of the total number of BoD members must belong to the underrepresented gender. This progressive requirement has already demonstrated a significant impact, as it has been highlighted by the President of the Capital Markets Committee, who emphasized the pivotal role of gender balance in strengthening corporate governance.

III. New Core Provisions

The new law 5178/2025 introduces Chapter B', which adds Articles 3A, 3B, and 3C to Law 4706/2020. The key provisions are as follows:

Article 3A mandates: 

• Active pursuit of gender balance by the companies on their BoD, equal treatment and equal opportunities for all genders. 
• minimum of 25% representation of the underrepresented gender on the BoD of all listed companies. 
• For large listed companies, this requirement increases to 33%. 
•  For large listed companies, when three or more executive members participate in the BoD, the above 33% percentage includes at least one executive member of the underrepresented gender.

Article 3B mandates: 

• Transparent and gender-neutral selection processes, with a preference rule that prioritizes the underrepresented gender when candidates are equally qualified. 
• Upon request, provision of information to the candidates within 20 days of their application about the criteria that influenced the selection decision.

Article 3C mandates: 

• Obligation of listed companies to publish an annual report on BoD composition and progress, publicly available on the companies’ website. 
• The report must also be submitted by September 30 of each year to: 

i.The Capital Market Commission. 

ii.The Department of Documentation, Research, and Digital Support (Gender Equality Observatory) under the General Secretariat for Equality and Human Rights of Ministry of Social Cohesion and Family.

iii.The Citizen's Advocate.

IV. Penalties 

Non-compliance with Articles 3A, 3B, and 3C may result in penalties enforced by the Capital Market Commission. These sanctions include a reprimand or a fine of up to €3 million, or up to 5% of the company’s total annual turnover. Any such decision is to be communicated within 20 days to the General Secretariat for Equality and Human Rights. Subsequently, the regulatory bodies will issue a public announcement on their website regarding the violation.

V. Public Procurement 

Companies bidding for public procurement or concession contracts must adhere to the gender balance obligations outlined in paragraphs 3 and 4 of Article 3A of Law 4706/2020. Failure to meet these requirements is deemed a violation of public procurement principles under Laws 4412/2016 and 4413/2016.

VI. Equality Badge 

A new Article 24A introduces the "Equality Badge“, a certification that companies may apply for as recognition of their commitment to policies promoting equal treatment. This certification is recorded in the General Commercial Registry (G.E.MI.). Within one month of the issuance, expiration, or revocation of the "Equality Badge," the General Secretariat for Equality and Human Rights must inform the G.E.MI. service under the Ministry of Development, which then updates the registry accordingly. 

Additionally, the General Secretariat for Equality and Human Rights may enter into cooperation agreements (Memorandums of Understanding) with companies and their associations under this law to further promote gender equality and combat discrimination in corporate environments. 

VII. Regulating Body 

The General Secretariat for Equality and Human Rights, under the Ministry of Social Cohesion and Family, is designated as the primary authority responsible for promoting, monitoring, and supporting gender balance on the BoD of publicly listed companies, as stipulated in paragraph 1 of Article 1 of Law 4706/2020.

The Hellenic Capital Market Commission is responsible for supervising listed companies and enforcing capital market legislation under Law 1969/1991. It is tasked with monitoring compliance with the obligations outlined in Articles 3A, 3B, and 3C of Law 4706/2020 and is authorized to impose sanctions as provided in Article 24 of the same law.  

VIII. Application of the rules to non listed SA’s

In article 87 of Law 4548/2018, par. 6 is added which provides that non-listed companies employing 250 or more employees and having an annual turnover of at least fifty million euros (€50,000,000) or an annual balance sheet total of at least forty-three million euros (€43,000,000) may, if stipulated in their articles of association, apply the provisions of Article 3A and Article 3B of Law 4706/2020.The provisions of Article 24A of Law 4706/2020, regarding the recognition and promotion of balanced gender representation on company boards, also apply to non-listed companies.

IX. Entry into force

Member States should have introduced the Gender Balance on Corporate Boards Directive until December 28, 2024.

The new Greek law 5178/2025 entered into force on February 14, 2025. Specifically, the new provisions of article 3A regarding the participation requirements, the article 6 regarding the selection process and the article 9 regarding the public procurement, entry into force on June 30, 2026, subject to paragraph 3 of Article 17 of the law.

X. Conclusion

The provisions of the new Greek law 5178/2025, which amends the governance law 4070/2020, are pivotal for fostering fairness, innovation, and economic growth by unlocking the full potential of diverse leadership.

Alongside the provisions for corporate boards, the law also includes significant measures to enhance the effectiveness of pilot programs funded by the Recovery and Resilience Facility. These programs address key areas such as accessibility interventions, supported employment for individuals within the autism spectrum, and the "Personal Assistant for Persons with Disabilities" initiative.

Together, these provisions reflect a holistic approach to advancing equality, accessibility, and quality of life.