GOVERNOR BROWN SIGNS SB 826 INTO LAW, MAKING CALIFORNIA THE FIRST STATE IN NATION TO REQUIRE MORE WOMEN DIRECTORS ON PUBLIC COMPANY BOARDS
Senate Bill 826 requires at least one seat to be added for a woman on boards of listed corporations that don’t have women directors currently
SACRAMENTO—Legislation authored by Senator Hannah-Beth Jackson (D-Santa Barbara), Senate President Pro Tempore Toni Atkins (D-San Diego), Senator Connie H. Leyva (D-Chino) and Assembly Member Lorena Gonzalez Fletcher (D-San Diego) to require gender diversity on corporate boards was signed by Governor Brown on Sunday, September 30th.
In his signing letter, Governor Brown said, “Given all the special privileges that corporations have enjoyed for so long, it’s high time corporate boards include the people who constitute more than half the “persons” in America.”
Senate Bill 826 provides equitable and diverse gender representation on corporate boards of directors by requiring every publicly-held corporation headquartered in California to have a minimum of one woman on its board of directors by the end of 2019. By the end of July 2021, the bill requires a minimum of two women on boards with five members and at least three women on boards with six or more. California is the first state in the nation to consider such a requirement.
“With the Governor’s support of SB 826, yet another glass ceiling is shattered, and women will finally have a seat at the table in corporate boardrooms,” said Senator Jackson. “With numerous independent studies showing that corporations with women on their boards are more profitable, SB 826 is a giant step forward for women, our businesses and our economy.”
Credit Suisse research demonstrated that gender diversity on corporate boards is associated with increased profitability, performance, governance, innovation, and opportunity. California’s corporations lag behind the national average, with only 15.5% of board seats held by women, lower than the Russell 3000 at 16% and the Fortune 1000 list at 19%.
European nations have led the way mandating gender diversity on corporate boards. In 2003, Norway mandated 40% of corporate board seats be held by women, followed by France and other European countries. In 2015, Germany mandated that 30% of corporate board seats be held by women.
Mindy Bortness, President, National Association of Women Business Owners California and Founder, Communication Works, Inc. stated, “On behalf of the 1.55 million women business owners in California, it has been the distinct privilege of NAWBO CA to have propelled SB 826 forward. We are confident this law will be the catalyst for greater prosperity via the brainpower and contributions brought by the unique, valuable perspective of women.”
"This is historic for women in California, and for all members of the 11 chapters in NAWBO-California. The keys to pursuing corporate boards are: strategic networking, visibility in the business community, and prior board experience. NAWBO members who have grown their companies have the CEO credentials to serve on corporate or large private boards”, stated Betsy Berkhemer-Credaire, CEO, 2020 Women on Boards and CEO, Berkhemer Clayton Retained Executive Search.
The National Association of Women Business Owners-California is the federation of ten chapters of women business owners throughout the state, representing the issues and interests of 1.55 million women business owners who employ 995,000 Californians in addition to their own jobs. Chapters are located in San Diego, Orange County, Inland Empire, Los Angeles, Ventura County, Santa Barbara, Central Coast, Bakersfield, Silicon Valley, Sacramento, and San Francisco Bay Area.
For more information, see www.NAWBOCA.org.