WOMEN ON BOARDS
Women hold just 22% of Russell 3000 board seats
WHAT YOU NEED TO KNOW
In 2018, State Senator Hannah Beth Jackson passed and Governor Jerry Brown enacted SB826, a first-in-the-nation law requiring publicly-traded companies with California headquarters to have at least one woman on their board of directors. By January 1, 2022, the law requires that boards of six or more directors have at least three women, and boards of five have at least two. Our data shows that at least 665 women need to be added to California public company boards by the end of 2021 to fulfill the gender requirement of the law.
The law was based on numerous studies showing that companies with female directors are more profitable. Other studies demonstrate additional benefits to having more than one woman on a corporate board, such as improved crisis management, sustainability practices, workforce engagement, and greater resilience during the 2008 recession.
Including women on corporate boards can also close the persistent gender and wealth gaps. Board directors are generally paid over $200,000 per year of service, and their leadership influences pay and hiring practices throughout corporations.
In order to understand the effects of this pioneering law, the California Partners Project is tracking the progress of women's representation on California's public company boards through a series of comprehensive progress reports. Data from our first progress report shows that California's law is working. In 2018, nearly 30% of California's public company boards were all male; now, less than 3% are. Our research also shows that 669 board seats have been filled with women since 2018. Through data collection and tracking, we can ensure that the law’s impacts are accurately measured, widely understood, and celebrated.
The possible opportunities for women at the highest levels of corporate oversight are staggering. If every state were to adopt California’s lead, U.S. companies in the Russell 3000 would need to open up over 3,500 board seats for women within a few years. The number of women on these boards nationally would increase by almost 75 percent.
CALIFORNIA PUBLIC COMPANY BOARDS
Board seats held by men
Board seats held by women
Women needed by 2022