Feb 21, 2020 - Economy & Business

California's "woman quota" law seems to be working

Illustration: Eniola Odetunde/Axios

When California passed its boardroom law requiring public companies based there to have at least one female director, there were concerns it would spark a gold rush for the same handful of well-known women — but that hasn’t happened.

Why it matters: Of the 138 women who joined all-male California boards last year, 62% are serving on their first company board, per a study by accounting firm KPMG. That means a majority of companies aren't contributing to so-called overboarding in corporate America.

The deadline to place a woman on an all-male board was Dec. 31, and KPMG has just tallied the outcome:

  • Only 4 women joined more than one all-male California board last year — with each joining two of these boardrooms.
  • Two-thirds of the women serve only on the board they joined last year.
  • The data suggest “the law broadened the candidate pool for public company directors,” KPMG writes in its report.

Of note: The report doesn’t look at whether the women are also on the boards of private companies or nonprofits.

There’s no standard definition of how many boards is "too many" for one person to serve on.

  • Vanguard, an asset manager that can sway corporate management, said last year it would vote against companies’ would-be board members who already serve on more than five boards.

The backstory: California's first-in-the-nation law was signed in September 2018, which gave companies more than a year to comply. By 2021, companies with five-person boards will have to have at least two women, while boards of six or more will have to have three.

  • 27 publicly traded companies in California — or 4% — still had all-male boards by the end of last year, KPMG says.

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Women underrepresented in global boardrooms

Source: MSCI All-Country World Index. Note: Reflects boards of 3,046 publicly traded companies based in 46 countries. Chart: Axios Visuals

Female representation on corporate boards around the world has doubled in the last decade. But board members — who play a big role in corporate decision-making, and earn big money for their labors — are still much more likely to be male.

Why it matters: Today is International Women's Day, and — despite unprecedented pressure from shareholders and others to diversify boardrooms — the prospects for gender parity there are bleak. Researchers say it could take another 25 years before there are just as many women as men in boardrooms worldwide.

International Women's Day and the glass ceiling

Data: Rutgers Center for American Women and Politics; Chart: Andrew Witherspoon/Axios

Women running for national and state office may be on track to break the record-setting runs and gains of 2018, as Republicans try to catch up with their Democratic counterparts.

Yes, but: The Super Tuesday results, and Elizabeth Warren's withdrawal, effectively ended any chance that this will be the year a woman wins the presidency. On International Women's Day this weekend, it's worth remembering that the struggle to reach the White House masks a lot of real progress at lower levels.

Facebook board nears gender parity with two new directors

Photo: Jakub Porzycki/NurPhoto via Getty Images

Facebook has added two new members to its board: Nancy Killefer, a former government official and longtime McKinsey executive, and Tracey T. Travis, the chief financial executive of The Estee Lauder Companies.

Why it matters: The additions double the number of women Facebook directors and make the board 40% female. Despite significant progress in recent years, women still hold just 20% of board seats globally in publicly traded companies.