In the past few decades, Europe has made significant progress in getting more women into the workforce. The female employment rate is 62 per cent, up from 55 per cent in 1997. In Malta, the female employment still stood at a low 41.6 per cent last year, although a significant improvement has been registered since 2004 when it was just 33.5 per cent.

In Malta, the situation is even worse, with women making up three per cent of board members

Women are also making great strides in education: they now represent 60 per cent of new university graduates. European Union legislation and financial support have contributed to these advances.

Despite this progress, there has been one significant shortfall: the lack of women at the top levels in companies. Many qualified women cannot break through the glass ceiling when climbing the corporate ladder. The facts are bleak: Just one in seven board members (13.7 per cent) at Europe’s top companies and one in 30 boardroom chairs (3.2 per cent) is a woman.

There has been some limited progress in recent years. The gender balance in Europe’s boardrooms saw a 1.9 percentage point increase from October 2010 to January 2012, compared to a long-term average rise over the last decade of 0.6 percentage points per year). However, France, which introduced quota legislation on gender balance in boards in 2011, alone accounts for around half the increase in the EU. But overall, change remains stubbornly slow. At the rate of progress over the last years, it would take another 40 years to achieve something approaching gender balance in boardrooms. The number of women chairing major company boards has even declined, falling to 3.2 per cent in January 2012 from 3.4 per cent in 2010.

In Malta, the situation is even worse, with women making up three per cent of board members. In these difficult economic times – when we are facing the twin challenges of an aging population and skills shortages – it is more important than ever to take advantage of everyone’s skills. There are four main reasons for helping women to finally break the glass ceiling in company boards.

First, the economy: getting more women into the labour market is an important contributor to improving Europe’s competitiveness. Having more women in the workforce will also help achieve the EU’s goal of raising the employment rate for adults to 75 per cent. You have to build up the pyramid with a strong base. Governments have a responsibility to improve and facilitate work-life balance so people can combine a family and a career.

Second, the business case for more women on boards: a growing number of studies show a link between more women in senior positions and companies’ financial performance.

For example, a report by McKinsey found that gender-balanced companies have a 56 per cent higher operating profit compared to male-only companies. Ernst & Young looked at the 290 largest publicly-listed companies. They found that the earnings at companies with at least one woman on the board were significantly higher than in those that had no female board member.

Thirdly, several EU member states have started to act by introducing legally binding quotas for company boards. The group of first movers includes Belgium, France, Italy, the Netherlands and Spain. Denmark, Finland, Greece, Austria and Slovenia have adopted rules on gender balance for the boards of state-owned companies. These different quota rules are new, and they can be a challenge for businesses operating in several EU countries. For example, businesses may have to comply with different national quota laws if they want to participate in tenders for public works.

Fourthly, Europeans support better gender balance. In a new Europe-wide opinion poll, 88 per cent of people across say that, given the same competence, they think women should be equally represented in top business jobs. In Malta the figure was 90 per cent. Across Europe, from politicians to academics to business leaders, people are aware that women mean business. This is a big step forward.

So, where do we go from here? One year ago, the European Commission, the European Parliament and ministers from several member states challenged publicly-listed companies in the EU to voluntarily improve the gender balance. Chief executives were asked to sign the “Women on the Board Pledge for Europe” to voluntarily increase women’s presence on corporate boards to 30 per cent in 2015 and 40 per cent in 2020. But so far, only 24 companies across Europe have committed.

That is why the European Commission has now launched a public consultation to identify possible action at EU level to redress the imbalance in Europe’s boardrooms. Can we continue to rely on self-regulation? Do we need binding quota rules as we have seen in several EU countries? Do we perhaps need coordinated or even harmonised action at EU level? Do we need quotas for all companies, or should we start with the larger ones?

Breaking the glass ceiling for women on company boards is a common challenge facing Europe’s economy. We can no longer afford to waste female talent. Persistent failure to encourage and enable women to make full use of their potential has cost us dearly. In these challenging times, the stakes are too high to keep the status quo. It is time to act now.

Viviane Reding is European Commission Vice-President and European Justice Commissioner. Simon Busuttil is a Member of the European Parliament.