Stay current on changes and developments in corporate law with a wide variety of resources and tools.
A bill highlighting corporate boards’ lack of women has the potential to appeal to both sides of the aisle as a House committee prepares to vote on it this week.
Legislation from Rep. Carolyn Maloney (D-N.Y.) would require publicly traded companies to disclose the gender of their directors, with the goal of nudging companies to bring more women into their mostly male boardrooms. The bill ( H.R. 1611) is slated to be marked up July 11 by the House Financial Services Committee.
It’s one of only about a dozen bills put forward by Democrats, among hundreds that are filed, that the Republican-led committee has voted on this Congress. So far, they’ve all passed the committee. Maloney’s bill, co-sponsored by five Democrats and one Republican, is expected to do the same.
The next step would be a vote on the House floor, followed by the Senate. But so far no matching Senate legislation has been introduced.
When it comes to women’s representation on boards, “I think we can all recognize that we should be doing better,” Maloney said in an email to Bloomberg Law. Women held less than 17 percent of board seats at companies in the Russell 3000 index as of the end of March, according to the latest data from Equilar Inc. About one-fifth of these companies had no female directors.
“This measure is simply about ensuring that investors have easy access to the information that they want — and need — to assess companies’ performance,” Maloney said. State Street Corp. and other institutional investors have been pressing companies with all-male boards to add women or risk votes against directors.
The bill’s backers include Catalyst, a nonprofit that helps advance women in the workplace, and the pro-business U.S. Chamber of Commerce.
“What’s good for women is good for business,” said Brande Stellings, who leads Catalyst’s consulting services for companies and their boards. Studies show companies with more women on their boards perform better financially.
“Given their mission and our mission, we’re clearly aligned on this,” she told Bloomberg Law.
The chamber, which has been lobbying for Maloney’s legislation in recent months, backs the bill for what it isn’t — a quota. It says quotas for how many women should be on each board are “counterproductive” and prefers the legislation’s disclosure-driven approach instead.
Stellings said the bill would take the “guesswork” out of tracking how many women are on corporate boards.
“Some you can tell from the pictures, the names, or the pronouns they use in the person’s bio,” she said. “But it’s not always obvious. There are names that are gender-neutral.”
Required reporting would also help show how women’s representation changes over time, Stellings said. The bill would create an advisory group at the Securities and Exchange Commission that studies gender diversity and recommends strategies for boosting it.
Even if women take half of all new board seats, it could be more than 40 years before they achieve parity in the boardroom, according to a report Maloney requested from the Government Accountability Office. She introduced similar legislation in 2016, but it didn’t get a committee vote.
To contact the reporter on this story: Andrea Vittorio in Washington at firstname.lastname@example.org
To contact the editor responsible for this story: Fawn Johnson at email@example.com
Copyright © 2018 The Bureau of National Affairs, Inc. All Rights Reserved.
All Bloomberg BNA treatises are available on standing order, which ensures you will always receive the most current edition of the book or supplement of the title you have ordered from Bloomberg BNA’s book division. As soon as a new supplement or edition is published (usually annually) for a title you’ve previously purchased and requested to be placed on standing order, we’ll ship it to you to review for 30 days without any obligation. During this period, you can either (a) honor the invoice and receive a 5% discount (in addition to any other discounts you may qualify for) off the then-current price of the update, plus shipping and handling or (b) return the book(s), in which case, your invoice will be cancelled upon receipt of the book(s). Call us for a prepaid UPS label for your return. It’s as simple and easy as that. Most importantly, standing orders mean you will never have to worry about the timeliness of the information you’re relying on. And, you may discontinue standing orders at any time by contacting us at 1.800.960.1220 or by sending an email to firstname.lastname@example.org.
Put me on standing order at a 5% discount off list price of all future updates, in addition to any other discounts I may quality for. (Returnable within 30 days.)
Notify me when updates are available (No standing order will be created).
This Bloomberg BNA report is available on standing order, which ensures you will all receive the latest edition. This report is updated annually and we will send you the latest edition once it has been published. By signing up for standing order you will never have to worry about the timeliness of the information you need. And, you may discontinue standing orders at any time by contacting us at 1.800.372.1033, option 5, or by sending us an email to email@example.com.
Put me on standing order
Notify me when new releases are available (no standing order will be created)