State legislators passed a bill Wednesday that would require publicly-traded companies headquartered in California to place at least one woman on their board by the end of next year — or face a penalty.
Source: https://money.cnn.com/2018/08/30/pf/california-women-company-boards/index.html
How the bill works:
- All public companies will need to have at least one woman on their board by the end of 2019. Boards with at least five directors will need two or three women by 2021; the number will vary depending on board size.
- Apple, Facebook, and Alphabet already have two women on their respective boards, but may be required to bring on more. A company like Netflix, which has six board members—of whom only one is a woman—would need at least one more woman.
- Companies that don’t comply would have to pay a fine.
- Private companies looking to go public may be forced to diversify their boards before filing for an IPO.
- Organizations that oppose the bill argue that it only addresses one type of diversity and could be a violation of the state or federal constitution if, say, a company has to turn down a male candidate or swap out a male board member for a female one.
While I believe female representation is important, I think this is the wrong way of solving it. This will potentially hurt businesses in California in the long run; not because of females are not competent enough, but because of state government overreach on businesses. It's a priority for businesses to hire people that they believe are adequate for the job, and mandated positions could lead to discrimination of other applicants.
Those are my thoughts.
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