CA to require public corporation to have female board members. Constitutional? Good policy?

CA is close to passing a law that would require public corporations, headquartered in the state, to have at least 1 woman on their BoD by 2019, and more going forward, depending on the size of the Board.

I can’t see how this is not explicitly a quota, which I believe the SCOTUS has said is not constitutional. Is there something I’m missing?

As for wether this is good public policy or not, I’m going to say “no”. It might very well be good for many companies to have women on their BoDs, but I don’t think the government should be micro-managing private corporations at that level. It would be one thing for the state to decide it didn’t want to business with companies that had all-male BoDs, but it should be up to the shareholders to decide the make-up of the Board.

I’m not going to claim that this will necessarily hurt companies. It probably won’t. But I believe it is a principle established in our jurisprudence (no mandated quotas) that we should maintain. Equality of opportunity, not equality of outcome.

I agree. If we are managing outcomes than we are saying that the group an individual belongs to is more important than the individual. That’s Marxist ideology, and it is intrinsically unjust and unfair. Managing outcomes based on group identity ended up killing 100 million people in the 20th century, outdoing fascism (which also states that’s one group identity is more important than their individual identity. Sense a trend?) in this regard.

So no, we should not manage outcomes based on group identity.

The proposed law, applies to Companies that have their headquarters in California. If the Company is incorporated in Delaware or another state, but has its headquarters in California, you may end up seeing companies move their headquarters out of state.

I agree the proposed law is likely unconstitutional because of the quotas.

Before the state starts legislating the make up of private sector company boards, why don’t they legislate that certain numbers of state legislators and federal representatives be women? Wait, that would surely be unconstitutional.

Funny, I was thinking along those lines when I first heard about this.

Is this one of those crazy things that legislatures do, like banning abortion, that they know is unconstitutional? In the abortion case, there is at least the “logic” that a more sympathetic SCOTUS might overturn* Roe or at least move the needle more in an anti-abortion direction. But is there any chance the court is going to say “actually, we now think quotas are OK”?

*I still don’t think they would, but I guess hope springs eternal

The bill says a woman is anyone who self-identifies as a woman, which is going to lead to complications. It doesn’t make any requirement of a request to change legal status, checking which bathroom they go into, or what they wear.

So Joe Director says, “for the purpose of my service on this board, I am a woman”. How is the State of California going to prove Joe isn’t a woman? Is there something else Joe has to do before being allowed a set on the BoD? Is there other legislation in CA concerning being a woman, and does it include anything other than the declaration? Does it have to be irrevocable? Is there a certain amount of time that has to pass between the declaration, and legal recognition? Do you need a diagnosis from a doctor than you are suffering from gender dysphoria, or you don’t suffer from it and are fine with your body but are a woman anyway?

Yes, of course it is an argument about semantics. But if California wants to pass this kind of legislation, that can’t be avoided. “You know what I mean” doesn’t cut a lot of ice in legalese.


Would you still be opposed if, instead of passing a law, they initiated a tax incentive?

Say, I don’t know, half a point off the tax rate if they meet a certain male to female ratio on the board?

No, I don’t see how that would help anything. Offering a tax incentive to do something presumably un-Constitutional is still trying to do something un-Constitutional.

Besides, it isn’t necessary (supposedly). The bill cites some studies that they claim show that

Let’s pretend for a moment that I believed them for a split-second, and that they weren’t cherry-picking and conflating correlation with causality. If it were true what they claim, then companies with women (however defined) on their boards would tend to out-perform those without, and would gain market share, and those without would lose market share and investors. So the legislature doesn’t need to do a damn thing - just watch themselves be proven right.


when I look at BODs for big companies they normally have at least 1 woman and 1 black person. I guess they feel that way they can avoid getting criticized . And if you look at senior management at those places , a high percentage of the women you see there are the HR heads.

I’m presuming the unconstitutional part is being compelled to do so. Not seeing how being encouraged or enticed to do so, with a tax break, would be unconstitutional.

It would be unconstitutional for the gov to force me to replace a twenty year old furnace. How is in unconstitutional if I’m offered a tax rebate to do so?

Can you explain?

I would still oppose it, as I don’t think the government should be micro-managing things at corporations like that. As for whether that would be constitutional or not, I don’t know. I’m guessing not, but I could be wrong.

ETA: You’re not compelled to do so as the law is written. Just pay the fine if you don’t want to comply.

California government went crazy some time ago.

Blatantly discriminatory. It isn’t even trying to correct a situation where gender discrimination has prevented women from serving on corporate boards, it claims that women are superior directors compared to men and thus mandates that women be placed on boards against the wishes of corporate owners.

I don’t think a tax incentive would be unconstitutional - there are lots of examples. I also don’t think it would be unconstitutional to force you to replace your furnace of any age. The ACA is proof of that. The government could force you to buy whatever they want now.

“Buy” is not analogous here, I don’t think. Can a corporation be taxed for not discriminating against men? Quotas are unconstitutional because they have been deemed to be discrimination. Congress could not tax corporations for hiring too many black people, right?

“Buy” is the example that **elbows **used. Well, “replace” actually, but I take the terms synonymously in this context.

The law already provides for tax incentives for things that cause a disparate impact among protected classes. Things like enterprize zone tax credits for hiring that target certain geographic areas certainly have a disparate impact on minorities who tend to populate these areas - except the disparate impact is favorable to them rather than unfavorable so it’s okay. So yes, tax law can be crafted to incent businesses to hire more minorities.

OK, on the tax incentive to buy a new furnace. Yes, the ACA litigation showed us that would be constitutional.

But I don’t see how you get from “buy a furnace” to “discriminate against men”. Your examples are things that might have a secondary, disparate impact on certain groups. The tax incentive suggested here would encourage an act that the government, constitutionally, cannot require. See my example of a tax credit for “not hiring black people”. We’re not requiring you to hire only non-blacks. We’re just giving you a tax credit if you only hire non-blacks.

The government already incentives discriminating against men in their contracting process, by favoring women owned businesses. That is discriminating against men. No reason why that incentive couldn’t take the form of reduced taxes.

Curious - what would happen if a company just happened to already have an all female board? Would they then have to bring on a man?

I’m not familiar enough with those rules. Do they enforce quotas? The sticking point for me is quotas. They have been deemed unconstitutional.

No they are not quotas. But neither are tax incentives for meeting certain criteria. The original question was whether tax incentives for the same behavior as a contrast to quotas would be constitutional. I think the answer is clearly yes. Tax incentives for the same behavior - hiring female board members, would be constitutional.