When one thinks about businesses, most think of various business characteristics, such as marketing, budgeting, and innovation. Social justice does not exactly seem to fit, but with the newly passed SB 826, it will be infesting the business realm.
Passed just last year, SB 826 aims to force corporations in California to have a minimum of one woman on their board of directors by the end of 2019. On top of SB 826, another provision is scheduled to be implemented in 2021, requiring two women on a five-member board and three women on a six-member board. Lastly, in an attempt to fix the alleged gender inequality, State Treasurer Fiona Ma created a registry that makes women’s resumes more accessible to corporations needing board members.
However, does the law really solve the issue at hand? The opposition to the law seems to answer this question.
While corporations support increasing diversity, the approach of a government mandate does not sit well with them. As the California Chamber of Commerce outlined, the new bill focuses on one aspect of diversity. Corporations in California have their own standards that encompass all aspects of diversity, which proves to be more productive and effective than a government mandate. Furthermore, former California Governor Jerry Brown could not fully support the bill during his tenure due to legal concerns. According to Brown, the legal issues are strong enough to prohibit the implementation of the bill.
Even though the strength of the monitoring is unclear, businesses could be hit with a $100,000 fine if they fail to report information or do not comply with the gender requirements. In addition, should the businesses fail to repeatedly report the information, the fine could increase to $300,000 each time. The bill and its imposed fines imply that the state is more concerned with social justice issues than the basic freedom of businesses.
It is clear that SB 826 will undermine the way businesses are run. One can believe that diversity is important and beneficial, but recognize that this bill does not even address diversity, instead pandering with a social justice agenda. Moreover, women would not even be hired based on qualifications, but simply to fulfill a required quota. For supposedly wanting progress for women, this law seems to do the exact opposite.
Photo by Benedikt Geyer