A new law introduced in the Netherlands to increase diversity on company boards does not apply to pension funds, Minister of Education, Culture and Science, Ingrid van Engelshoven, has confirmed.

The Dutch Federation of Pension Funds said the minister confirmed on 19 May, in a response to a question from the Standing Committee of Education, Culture and Science, that pension funds do not fall under the target scheme.

This is because most pension funds are registered as foundations (stiching), which are exempt from the new rules.

The new law concerns large public limited liability companies (NVs) and private companies (BVs), approximately 5,000 companies. It was passed in December 2019 as a way to improve gender diversity on corporate boards. It requires companies to have at least 30 per cent of their supervisory board seats held by women.

Van Engelshoven did however note that pension funds have their own target scheme for gender and age diversity. Under the Code Pensioenfondsen rules, every pension fund board must have at least one woman and one man on the board, and at least one person under 40 years old and one person over 40 years old.

The Dutch Federation of Pension Fund said the effects of these measures will become visible in the coming years for the pensions industry. However, it believes the sector may also learn from the government’s programme to increase diversity.

In February this year, Minister of Social Affairs and Employment, Wouter Koolmes, gave an update on the diversity within pension fund boards. At the end of 2018, 72 per cent (2016: 59 per cent) of the pension funds had a woman and 45 per cent (2016: 38 per cent) of the pension funds had a young person on the board.

Nevertheless, according to Koolmes, the figures fall short of the objectives that the sector has set itself in the Code Pensioenfondsen. In 2018, 19 per cent of all pension funds (2016: 30 per cent) had neither a woman nor an under 40-year-old on the board. He said boards that are not diversely composed have missed opportunities when filling vacancies.

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