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Girls & Women

California Pushes Forward Bill That Would Require All Corporate Boards to Include Women


Why Global Citizens Should Care
Of the trillions of dollars spent by large corporations and governments every year, only 1% goes to women. Bills like this help bridge the gender inequality gap that limits women’s opportunities in the workforce. You can join us in supporting women entrepreneurs here

California is making strides toward gender equality in the workplace.

Lawmakers passed an approved senate bill to Gov. Jerry Brown on Thursday that would require corporate boards of directors throughout the state to include women. If Brown signs the bill into law, California would become the first state in the US to implement such a rule.

Take Action: Sign the petition calling on influential companies to support women-owned businesses.

The bill would make sure publicly held corporations in California include at least one woman on boards of directors by the end of 2019, and at least two by July 2021, the Los Angeles Times reported. Corporate boards with six or more members would need at least three women by the middle of 2021.

Democratic Senators Hannah-Beth Jackson and Toni Atkins presented the bill, citing the fact that women make up 52% of California’s population, but only 15% of the directors of its public corporations. 

On Thursday, Atkins took to the senate floor to say she was tired of not seeing other women in positions of power. Jackson emphasized that because women make more than 70% of purchasing decisions, their perspective should be taken into account when it comes to major decision making. 

“It’s time that we burst that man-cave and put women in the boardrooms,” Jackson told the senate chamber.

The California Legislative Women’s Caucus supported the effort and brought attention to the fact that there aren’t any women present in a quarter of the boards of directors in the state.

Companies that fail to honor the bill could be fined up to $300,000 by the state, according to the Sacramento Bee. Annalisa Barrett, a clinical professor of finance at the University of San Diego’s School of Business, estimates 377 major California-based companies will have to implement the change and smaller businesses won’t be exempt.

Not everyone agreed with the law aimed to grant women more representation in the workplace. A coalition of 30 business groups claimed they support gender equity but ultimately wrote a letter opposing the new law. One of the groups, the California Chamber of Commerce argued the bill favors women over other underrepresented groups of people, is unconstitutional, and puts companies in a position to discriminate against qualified men. 

“I can’t support a bill that underestimates the power and strength of women,” Senator Joel Anderson, representing California’s Alpine County, said.

Read more: Gender Inequality Could Be Costing the World $160 Trillion

Lucy Dunn, president and CEO of the Orange County Business Council, shared a similar sentiment. 

“This legislation is, to me, insulting,” Dunn said. “Rather than celebrate the competitive advantage women bring to positions of leadership in a company, it relegates them to placeholder status.”

The game-changing bill still managed to pass in the Senate, with an overwhelming majority of 23-9 votes.

While California would be the first in the country to implement such a law, it’s not the first in the world to do so. In 2015, Germany required 30% of corporate board seats to be held by women. And Norway required as high as 40% of corporate board seats to be filled by women in 2003. 

"Adding women board members to our public corporations will help advance family-friendly policies in the workplace and bring California one step closer to gender equity,” Anne Staines, statewide president of the National Association of Women Business Owners, told the LA Times.

If the bill passes, Fast Company noted that big companies like Apple and Facebook, which already have two women on each of their boards, might need to add a third. Netflix would also have to up the number of women on its board, from six to seven. Private companies looking to go public might need to adjust their board team before doing so.