The long-awaited transposition into Luxembourg law of Directive (EU) 2022/2381 on improving the gender balance among directors of listed companies and related measures (the “Directive”) is now on track. Draft law No.8519 setting a quantitative target for gender balance among directors of listed companies (the “Draft Law”) was submitted to the Luxembourg Parliament (Chambre des Députés) on 28 March 2025.
For further insights into the Directive, refer to our 2023 Newsletter.
This legislative proposal establishes binding requirements to ensure gender balance within the boards of directors of listed companies. It also outlines measures for compliance, reporting, and enforcement.
Scope and objectives
The Draft Law shall apply to all companies whose registered office is in Luxembourg and whose shares are admitted to trading on a regulated market in one or more EU Member States. However, in alignment with the Directive, the Draft Law excludes from its scope listed companies that qualify as micro, small, and medium-sized enterprises (“SMEs”).
One of the key objectives of the Directive is faithfully mirrored in the Draft Law by introducing a minimum requirement: at least 33% of board positions, both executive and non-executive, must be held by the under-represented gender by 30 June 2026.
The Luxembourg angle
While largely aligned with the Directive, companies should be aware of several Luxembourg specific elements introduced by the Draft Law:
Supervisory authority
The CSSF shall be designated as the competent authority, tasked with overseeing compliance, collecting data, and publishing an annual list of companies that meet the target.
Procedural adjustments
Where companies fall short of the target, they must adapt their director selection procedures. Clear and neutral criteria must be applied and documented during the selection process, with preference given to equally qualified candidates from the under-represented gender—unless objective diversity-related or legal considerations justify otherwise.
Candidate rights
Candidates involved in the selection process may request access to the evaluation criteria used and any factors that influenced the final appointment decision.
Public reporting
Companies shall be required to report annually on gender representation. This data must be disclosed to the CSSF, published on their websites, and, where relevant, included in their corporate governance statements. After the Draft Law enters into force, the CSSF will submit a report on its application to the Luxembourg government every two years, starting on 1 December 2025. This report will subsequently be forwarded to the European Commission, as mandated by the Directive.
Coordination with equality authorities
The gender equality observatory, established under the law of 7 November 2024, will work alongside the CSSF to monitor progress and promote best practices.
The Draft Law will enter into force upon its official publication and shall expire on 31 December 2038.
Enforcement
The CSSF shall be granted robust supervisory and enforcement powers, including the authority to issue warnings and reprimands, to publish public statements identifying non-compliant companies, and to impose administrative fines of up to EUR 250,000; additionally periodic penalty payments may be levied on companies that repeatedly fail to comply with the obligations (up to EUR 1,250 per day; capped at EUR 25,000).
What’s Next?
As the Draft Law progresses through Luxembourg’s legislative process—its timeline contingent on the speed and degree of consensus among stakeholders—companies which will fall within its scope are encouraged to take proactive steps in anticipation of its entry into force.
On this basis, listed companies can already start conducting a gap analysis to evaluate current board gender representation; review and formalize director selection policies, ensuring alignment with the transparency and fairness standards set by the Draft Law; prepare internal processes for reporting obligations and consider developing or refreshing a broader diversity policy.
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