Board Diversity Legislation

As the economic and social significance of board diversity becomes more widely recognized, some U.S. state legislatures have taken initiatives to address the rising concerns for demographic variety in the corporate boardroom. Listed below is the run-down of each state that has introduced and/or passed bills regarding diversity.

Laws

California (2018) Senate Bill 826

By the end of 2019, every publicly held domestic or foreign corporation whose principal executive office is in California is required to have a minimum of 1 female director on its board. Further, by the end of 2021, each one with 6+ board seats must have at least 3 women, those with 5 seats must have at least 2 women, and those with 4 or fewer seats must have at least 1 woman.

Illinois (2019) HB3394

Though initially introduced with specific representation requirements for every corporation to have a minimum of 1 female and 1 African-American director on its board, this bill now only requires that all publicly held domestic or foreign corporations whose principal executive offices are in Illinois must annually file public disclosures regarding the racial, ethnic, and gender demographics of their board.

Mandate Proposals 

Mandate proposals are bills that have been introduced within the legislature but have not received any formal action(s) yet.

New Jersey (2018) A4726

All publicly held domestic or foreign corporations whose principal executive offices are in New Jersey must have a minimum of 1 female director on its board by the end of 2019. By the end of 2021, those with more than five directors must have at least 3 women.

Past Resolutions

Past resolutions are written motions that cannot progress into a law, but instead function as signifiers of the legislature’s position on certain issues and encouragements for certain actions to be made.

Massachusetts (2015) Resolution S.1007

By the end of 2018, all publicly held domestic or foreign corporations whose principal executive offices are in Massachusetts with 9+ members should have a minimum of 3 female directors. Boards with fewer than 9 members should have at least 2 female directors.

In addition, the legislature urges these corporations to disclose the gender diversity on their boards and implement policies and practices designed to increase the number of female directors.

Illinois (2015) HR0439

By the end of 2018, all publicly held domestic or foreign corporations whose principal executive offices are in Illinois with 9+ members should have at least 3 female directors. Boards with 8 to 5 members should have a minimum of 2 women and those with 4 or less members should have a at least 1 woman.

Pennsylvania (2017) HR273

By the end of 2020, all publicly held domestic or foreign corporations whose principal executive offices are in Pennsylvania should have boards comprising at least 30% women.

Colorado (2017) House Joint Resolution 17-1017

By the end of 2020, all publicly held domestic or foreign corporations whose principal executive offices are in Colorado with 9+ members should have at least 3 female directors. Boards with 8 to 5 members should have at least 2 women and those with 4 or less members should have at least 1 woman.

 

This article is current as of September 5, 2019.

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