California just passed a law (SB-826) requiring all publicly-held corporations (both domestic and foreign) whose principal executive offices are located in California to have a representative number of women on their company board of directors. It appears California companies are behind the curve when it comes to female representation. The fine for violating this new law? $100,000.
Partial Text of SB-826
“This bill, no later than the close of the 2019 calendar year, would require a domestic general corporation or foreign corporation that is a publicly held corporation, as defined, whose principal executive offices, according to the corporation’s SEC 10-K form, are located in California to have a minimum of one female, as defined, on its board of directors, as specified. No later than the close of the 2021 calendar year, the bill would increase that required minimum number to 2 female directors if the corporation has 5 directors or to 3 female directors if the corporation has 6 or more directors.” Click here to read the rest of this bill…
Read this article listing the 100 California companies with no women on their board of directors.
Affirmative Action is a Losing Proposition
How many times must we remind legislators that Affirmative Action is a losing proposition? (Read how Affirmative Action has hurt Asian-American college admissions.)
We women do not need favored status to achieve equality — we gain it through merit. And if companies don’t act quick enough to recognize the talents and knowledge women possess, many of us leave to start our own businesses.
According to the 2017 State of Women-owned Business Report commissioned by American Express, we contribute a great deal to the economy and employment numbers. Women-owned firms (51% or more) account for 39% of all privately held firms, contribute 8% of employment and 4.2% of revenues. That means more than 11.6 million firms are owned by women, employ almost 9 million people, and generated $1.7 trillion in sales as of 2017.
Too Much Government Regulation
California is well known for over-regulating. But regardless which state we’re talking about, the last thing we need is more government regulation. We could do with less segmenting of society, identity politics and burdensome criteria imposed on organizations, either public or private. We don’t need to give our hard working, beleaguered HR folks more reports to file with the state or federal government. No more bloated bureaucracy. No more favoritism.
When government gets involved and either dictates or incentivizes gender (or race) based participation, you end up with systems where finding a woman – any woman – to hold 51% ownership in a company qualifies them for the coveted “woman-owned” status. That’s just one of a number of categories to give you added brownie points when it comes to landing government contracts.
But I digress. If we believe more female leadership on governing boards would be a good thing, how do we facilitate and encourage voluntary involvement?
- We promote opportunities to emerging leaders in the workplace and business community. Sometimes people can’t even conceive of themselves in those positions unless someone suggests they’d be a great contributor.
- We invite them to attend board meetings and make some of them (if not all) open to the public. Encourage them to see exactly what goes on so they can decide if it’s something they want to pursue.
- Create board of directors internship and mentoring programs. Consider it a pool of candidates to draw from in the future. No promises, but it provides opportunities for development.
I do not believe it’s right or fair to “vote” for anything or anyone based on gender. It should make no difference whether you’re male or female. It should also make no difference whether you’re Asian, Black, Caucasian, Hispanic or some combination categorized as all-of-the-above.
When government meddles, things get far too complicated. Rather than more force, we need companies and governing boards to voluntarily seek out the most qualified candidates. They should by now recognize that representatives from half the population would give them another valid perspective on investments, customer relations issues, crisis-management, profitability and productivity.
After all, it’s just possible a large number of their shareholders, customers and employees are women too!