Contact us with your California corporate & securities law questions (949) 353-6347 or Contact us here

California's Racial/Ethnic Board Quota Bill Amended To Include Sexual Orientation

Next Monday will mark the end of the California legislature's current session, meaning that any bill not passed by that date will die.  Typically, the last few days of a legislative session are chaotic with many bills being amended at the eleventh hour. 

I have previously written about AB 979 (Holden) which would require publicly held domestic and foreign corporations with their principal executive offices in California to have minimum numbers of directors from "underrepresented communities".  AB 979 is patterned after SB 826 which imposes female director quotas.  See California Enacts Novel Female Board Quota Legislation.

AB 979 was amended last Thursday to expand the definition of "director from an underrepresented community" to include an individual who self-identifies as "as gay, lesbian, bisexual, or transgender". 

The bill also included some additional legislative findings with respect to current racial and ethnic group representation on public company boards.  This may have been in response to my testimony before the Senate Banking and Financial Institutions Committee in which I pointed out that the legislative findings in the bill did not relate to director representation.  The amendments did not address my other comments, including the fact that the bill will discriminate against males board candidates who are from underrepresented communities.  Oddly, the bill will now also discriminate in favor of transgender females and against transgender males.  It would also privilege transgender females over individuals self identifying only as female because transgender females would apparently qualify as "female" under SB 826 and as being from an underrepresented community under AB 979.  It is unknown if this was intended and, if so, why.

Another obvious problem is that the bill relies on self-identification.  Does this mean that identification may be wholly-subjective?  Could a person with no factual basis simply self-identify as being from an underrepresented community?  Could Rachel Dolezal, for example, self-identify as Black?

The bill's racial and ethnic categories, moreover, are vague and ambiguous.  For example, could former California Supreme Court Justice Marvin Baxter self-identify as Asian based on his Armenian ancestry?  Could former U.S. Supreme Court Justice Benjamin Cardozo have self-identify as Hispanic based on his status as a Sephardic Jew?  Justice Cardozo was a member of Shearith Israel, the Spanish and Portuguese Synagogue in New York.  Shearith Israel, which was founded in 1654, was the first Jewish congregation to be established in North America.

Share on:

Corporate Governance

ANY QUESTIONS REGARDING CALIFORNIA CORPORATE AND SECURITIES LAW? CONTACT US DIRECTLY

We offer expert advice with the intricacies of California law.

Our years of experience and expertise allow us to help clients navigate the business laws in California.

CONTACT US

ABOUT OUR AUTHOR

30172DBAB0084D3A8F39D7AF0A8E79BC.ashx Keith Paul Bishop
Partner at Allen Matkins
(949) 353-6328
 Contact me
Learn More About Keith

RECOGNITION
JD Supra Readers Choice Top Author 2020

NationalLawReview



nominee-badge

Get the latest news and analysis about California Corporate & Securities law. Subscribe to our newsletter today!

We respect your email privacy

CATEGORIES

see all

YOUTUBE

FACEBOOK