CHILE Trends and Developments Contributed by: Juan Pablo Halpern, Arturo Pino, Francisca Zuccone and Carolina Schiele, Clyde & Co Chile
cial Market Commission (CMF), which mandate transparency in corporate diversity efforts. It also underscores the country’s commitment to imple - menting sustainable governance standards. The implementation of these quotas will follow a gradual approach. In the first three years, a rec - ommended benchmark of at least 20% female board participation will be encouraged. Between years three and five, this recommendation will increase to a minimum of 40%. While adoption of these quotas will remain optional during the initial five-year period, companies choosing not to comply must provide an explanation to the CMF, adhering to the “comply or explain” prin - ciple. Beginning in the sixth year following the law’s enactment, if approved, company boards will be required to maintain a minimum of 40% female representation. The same phased approach will also apply to the selection of alternate directors, ensuring sustained gender diversity in leader - ship positions.
If the election process for board members - out - lined in the company’s bylaws - fails to meet the required quota, the gender quota bill mandates that the election be repeated until the minimum percentage is reached. As a final measure, if compliance is still not achieved, the CMF may intervene and impose sanctions on the compa - ny, reinforcing the law’s commitment to equita - ble representation. The gender quota bill remains under review; however, it has recently made progress and is now undergoing its second constitutional exami - nation. By promoting gender diversity at the highest levels of corporate governance, the gender quota bill seeks to create a more equitable and forward-thinking business environment, reinforc - ing the value of diverse perspectives in strategic decision-making and long-term organisational success.
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