California Sued Over Sen. Jackson's Law Requiring Women on Corporate Boards
By edhat staff
A conservative activist group filed a lawsuit against the State of California on Friday over the recent requirement for women on corporate boards.
Senator Hannah-Beth Jackson authored SB-826 with Senate President pro Tempore Toni G. Atkins of San Diego as a first-in-the-nation law. Governor Jerry Brown signed the bill last year which requires every publicly held corporation in California to have a minimum of one woman on its board of directors by the end of 2019; two or more by 2021 for boards of five; and three women by 2021 for boards of six or more. Companies that don’t comply will be fined $100,000 for their first violation.
Judicial Watch, a Washington-based conservative activist group, said in a lawsuit filed this week on behalf of three California taxpayers that spending taxpayer money enforcing the law is illegal under the California constitution. The lawsuit cited equal-protection grounds and Judicial Watch President Tom Fitton stated, "California's gender quota law is brazenly unconstitutional."
“While I certainly respect the constitutional right of anyone to challenge the law in our courts, it is disappointing that this conservative right wing group is more invested in spending thousands of dollars on a questionable lawsuit than supporting policy that improves business’ profits and boosts our economy. While the courts consider this challenge, many companies have already voluntarily complied. Just last month, the last all-male board of the S&P 500 added a woman to its ranks, showing that diversity is within our grasp and that women are highly qualified and eager to step up, “ said Jackson.
“This lawsuit is merely an effort by a conservative ‘foundation’ to try to erode the landmark progress our state is making not only for women, but for business and our economy. I’m confident the courts will see through this thinly veiled attempt to block highly qualified women from serving on the boards of our publicly traded corporations. More women in those positions makes sense for profitability and it makes sense for equality,” said Atkins.
Mercury News reports most well-known tech companies are in compliance with only a handful of the top 150 Silicon Valley companies needing to add a woman to their board of directors.
A number of studies, including one by Credit Suisse, show a strong correlation between women on boards and company and stock performance. A 2017 study by Morgan Stanley Capital International found that United States’ companies that began the five-year period from 2011 to 2016 with three or more female directors reported earnings per share that were 45 percent higher than those companies with no female directors at the beginning of the period.
- October 5, 2018 - California is the First State to Require Women on Corporate Boards