May 25, 2022
California’s Board Gender Diversity Statute: Down, But Not Out?
Dave blogged last week that a California court struck down the state’s board gender diversity statute, finding that it violated the Equal Protection Clause of the California Constitution. The same plaintiffs also recently prevailed on a motion for summary judgment to challenge the statute that would require a certain number of directors from “underrepresented communities.”
According to this Cooley blog, the California Secretary of State has announced that the state will appeal the May 13th decision. As the blog details, the Secretary of State believes that the statute is narrowly tailored to serve a compelling interest.
If you’re advising a California-headquartered company on next steps, remember to check the voting policies of the company’s shareholders and consider that in your analysis. For example, State Street announced that beginning in 2023, it expects Russell 3000 companies to have boards composed of at least 30% women directors. It may vote against the chair of the nominating committee if the company fails to meet expectations – and against all members of the nominating committee if the failure continues for 3 consecutive years. For convenience, we’ve collected voting policies from major institutional investors and asset managers in our “Institutional Investors” Practice Area – along with interpretive analysis, info on voting outcomes, and more.
– Liz Dunshee