California May Be First In US To Mandate Women On Boards

California is moving towards becoming the first state to set quotas for ensuring companies to have women on boards. Two female state senators are organizing a bill to mandate this. The bill will aim to promote greater gender representation in corporate decision-making.

Women make up about more than half of the total US population. However, out of the entire female population, only 18% occupy its corporate board seats.

Quartz compiled a list last year which revealed that there are 624 publicly traded companies nationwide that lack women on their corporate boards

The list also included names like Bay Area companies CAI International, Rigel Pharmaceuticals, Sigma Designs, Aqua Metals and more.

To overcome this situation and bring more women on boards, California legislators have introduced the bill. The bill would require publicly traded companies based in the state to have at least one woman on their board, starting in 2020.

Also: 64% Female Writers In US Sexually Harassed At Work: Survey

And then after two years, in 2022, companies with at least five directors would be required to have two more female board members. Companies with at least six directors would need to have at least three more. Those failing to comply and meet these obligations would face a fine. Firms would be fined “an amount equal to the average annual cash compensation for the directors of the corporation” for a first offence. The punishment would also include escalating penalties for subsequent infractions.

The bill, named SB-826, has already won the state Senate approval. It now requires the approval of the state assembly which would be done by August 31 and further progress to the desk of California governor Jerry Brown.

Business lobbyists are opposing the bill, stating it will force them to give privilege to more women, even above more deserving male minority candidates.

The concept of board quotas is not new. Other countries have been more proactive and taken this step way back. In 2007, Norway was the first country to pass such a law. According to the law, 40 per cent of corporate board seats are to be held by women. Germany in the year 2015 set a 30 per cent requirement. Countries like Spain, France, and Italy have also set quotas for public firms.

Also Read:Women quotas in corporate causing more harm than good?

More Stories By Deepali

Deepali Is An Intern With SheThePeople.TV