As part of its effort to close gender-based pay gaps, California will now require companies to increase female representation on boards of directors.
Currently, one in four publicly held corporations in California have no women on their boards of directors. SB 826, which Governor Jerry Brown signed into law at the end of September, requires that all publicly held corporations based in California have at least one woman director by December 31, 2019. That is not the end of the requirements; by December 31, 2021, companies with five authorized directors must have a minimum of two female board members, and companies with at least six directors must have a minimum of three females on the board. The California Secretary of State will publish the names of compliant and non-compliant companies on an annual basis. In addition to the “name and shame” provisions, non-compliant companies face fines of $100,000 for the first violation and $300,000 for subsequent violations. READ MORE