(Bloomberg) --

Israel’s securities regulator is urging companies to appoint more women to their boards, while stopping short of introducing regulation forcing them to do so.   

The Israel Securities Authority wants women to account for 35% of board positions for at least half of all reporting companies, mutual-fund firms that manage over 5 million shekels ($1.5 million) and major portfolio managers by 2028, according to a statement. At present, only 16% of reporting companies meet this standard.

“This is an unacceptable situation that is far from where women and the capital-market corporations should be,” said Anat Guetta, chair of the authority. “A significant change is required.” 

Boards all over the world are under mounting pressure to increase diversity, in gender and race. Nasdaq Inc. in August won regulatory approval to require more than 3,000 member companies to report diversity and either meet a minimum standard or explain why they don’t. California also requires companies based in the state to meet minimum gender and other diversity requirements.

In order to reach its goal, the Israel Securities Authority is establishing a forum that will include, on a voluntary basis, representatives of companies that already meet the 35% standard, and can help spearhead efforts. Firms interested in increasing the representation of women will also be able to join the forum.

Guetta favors a voluntary program, rather than regulation, which she says should only be the last resort, due to its potential negative effects. 

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