Home / Media / Article




September 3 2019

Government Mandated Corporate Gender Quotas

featuring Jennifer C. Braceras

Should government mandate diversity on corporate boards? California passed a law doing just that, and Massachusetts may not be far behind. Jennifer Braceras, Director of IWF’s Center for Law & Liberty, speaks with Anastasia Boden of the Pacific Legal Foundation.

Beverly H:
Hey everyone, it's Beverly Hallberg. Welcome to a special pop-up episode of She Thinks, your favorite podcast from the Independent Women's Forum where we talk with women and sometimes men about the policy issues that impact you and the people you care about most. Enjoy

Jennifer B:
Hi everyone. I'm Jennifer Braceras, director of IWF Center For Law and Liberty and today I'm joined by Anastasia Boden from the Pacific Legal Foundation and we are talking about forced gender quotas for corporate boards. That's where the government requires either public boards, or in some cases private companies, that are regulated by the state to set aside a certain number of boards spots for women. Thank you for joining me.

Anastasia Boden:
Thanks for having me.

Jennifer B:
Now I understand that California is the first state to pass a law requiring set asides for women on boards. And you wrote a fantastic piece earlier this month in the Los Angeles Times where you took issue with this policy. But before you tell us all the things that are wrong with the law, maybe you could tell us a little bit of background about what exactly the California law says, and what it attempts to accomplish and what the requirements of that law are.

Anastasia Boden:
Sure. So last year the former governor Jerry Brown signed into law, California's women quota, which requires all public boards that are either incorporated in the state or even those boards of companies that are outside the state but have a headquarters in the state to have at least one woman on their board by the end of 2019. And then that quota will increase to at least two women if there's a five member board, and three women where there's at least a six member board by the end of 2021. So it's an increasing quota and it has some pretty hefty penalties. You're charged $100,000 fine for the first violation and a $300,000 fine for any subsequent violation. And every empty spot that should under this quota belong to a woman is a separate violation. And it's interesting ...

Jennifer B:
So the violations accumulate each year, so or ...

Anastasia Boden:
That is right, yes.

Jennifer B:
Okay. And how do they plan to enforce it. Do the companies have to file proof that they've complied or is it just part of their regular corporate filings? How does that work?

Anastasia Boden:
Yeah, as far as I know, I think there's already a reporting requirement that's going to be imposed where you have to prove that you are in compliance with this, with the Secretary of State's office, just like all the other corporate filings that go through that office.

Jennifer B:
So I guess I'm wondering if this is sort of a solution in search of a problem, right. So, I mean, I know there's still a dearth of women on some of these corporate boards, but my understanding, and correct me if I'm wrong, is that we have been making progress in this arena sort of through the free market and over the course of time.

Anastasia Boden:
Yeah, that's absolutely right. I think women are making gains in the absence of government intervention. They're making gains by themselves. They're lifting themselves up by the bootstraps. So for example, between 2010 and 2015 the share of women on public boards increased by 54% globally. I think all tolled women hold about 20% of board positions of corporations that are on the S&P Index. It's funny because there's also been a proposed mandate in Illinois. Now a bunch of states are trying to follow suit, and yet in Illinois, every single public company already complies with this sort of quota. So yeah ...

Jennifer B:
Voluntarily?

Anastasia Boden:
I do think it's a solution in search of a problem. Yeah, voluntarily. Just because women are making it there by themselves. And so when we impose a quota like this, we perpetuate a stereotype about women that doesn't exist. It says that women aren't making it to the board room, that they're constantly being discriminated against even when they're not.

Jennifer B:
I wonder also if some of the reason for the disparity, the numerical disparity, just has to do with choice, free choice, the same way that, that the wage gap exists in large measure because of the choices women make in terms of careers and wanting to pursue different avenues than men on average. Does that play a role?

Anastasia Boden:
I mean you can imagine that there's some industries where there's just different interest from the genders. Are there certain companies that are maybe geared towards female products that males have less of an interest in? Or maybe there's even companies that are male groups or what have you, like church groups or things that are incorporated, that may be geared towards one gender and so there's just not an interest from the other side. You're talking about the free choices of women and how that creates disparities. I thought it was interesting that recently Uber did a study about the pay gap because they pay their employees blindly. They don't look at the gender, it's just according to an algorithm, right.

Jennifer B:
Right.

Anastasia Boden:
So they have no control over pay choices. And yet they found out that there was a "pay gap" between men and women. And that was just because women tend to drive slower, they choose to drive at different times of the day, they don't feel as comfortable driving at night alone. They take fewer trips, they're not driving during times when there's like a three times increase, surge pricing it's called, on the pricing of it.

Jennifer B:
Right.

Anastasia Boden:
So women are being paid less and it's not because of discrimination, it's just because we make different choices.

Jennifer B:
Right, that's interesting. I had not heard about that Uber study, and I will certainly look it up. I know there's also a study out of Harvard, I believe the Business School, but I'm not sure that looked at transportation workers, bus drivers in the Massachusetts or maybe just Boston area. They're all unionized. So they should theoretically be paid the same based on the union contracts. But what they found was that women do not seek out overtime opportunities at the same rate as men because primarily they want to get home to their families. So in the end, the men end up making more, even though it's not because of discrimination.

Anastasia Boden:
Right, yeah, I found it interesting that Norway has imposed quotas for public boards. In fact, they have a 40% quota for women. And what they found ...

Jennifer B:
Throughout the whole country?

Anastasia Boden:
Right, throughout the entire country, and what they found was not that there were all these women who were waiting to be hired and had been discriminated against. That actually created a shortage of qualified women and so public companies started switching back to private to avoid the mandate because they were in search of people who they felt were interested or qualified for the position and they didn't want to be fine. So they found that a bunch of corporations just transitioned back to private rather than having to be subject to the mandate.

Jennifer B:
Yeah, there's always a workaround. Whenever a government passes a law, the free market finds its work around, doesn't it?

Anastasia Boden:
Right, exactly.

Jennifer B:
Okay, so those are some of your policy objections, right? That, that you mentioned that it sort of reinforces stereotypes and maybe that it doesn't work because there's in other countries that have tried it, there've been, companies have found the work around. But you also talk in your LA Times piece about legal objections, and what I thought was really fascinating is that even Jerry Brown, who was the Governor who signed the law said, oh yeah, this probably isn't constitutional. But I'm going to sign it anyway. So what are the legal problems with laws like this?

Anastasia Boden:
Yeah, well the Constitution and the Supreme Court frown upon quotas like this because any time that the government makes distinctions based on characteristics like race or gender, it's really inherently offensive even when they're trying to do it for a good reason. And part of that is because, like we talked about, it reinforces these stereotypes about the capabilities of women or of races that you're trying to help. And it's also because it's sometimes, it's hard to even see if they're really trying to help that group or if there's some nefarious intention buried beneath it. So anytime the government makes these classifications, they subject the court when scrutinizing a lot, will subject it to very rigorous scrutiny. And that means that the law has to be narrowly tailored to some important government interest. And I think that here that's, the law is not going to pass.

Anastasia Boden:
As Governor Jerry Brown admitted, it's not going to pass because it's not tailored to anything like discrimination because it applies to companies regardless of whether they have discriminated in the past. And applies to all industries regardless if there's any evidence of discrimination in that industry. So you can't really say it's narrowly tailored to that. And the quota is arbitrary. It's just picking a number out of a hat. The government can't say, oh, we selected this number because we found this amount of discrimination and this is going remedy it. It just picked a number out of a hat. So I don't think it's going to pass constitutional muster.

Jennifer B:
Now is the Pacific Legal Foundation or any other group that you know of challenging this in court? I mean, are there legal cases that the will decide the fate of this law?

Anastasia Boden:
We would be very happy to challenge it in court. We have been at the forefront of fighting for equal protection before the law. We take cases like this all the time in the racial context, but here we just haven't found anybody who's willing to speak up and be a plaintiff. I think there's a lot of pressure in California to conform to this. Nobody wants to be the person to say, hey, I don't want to be forced to put a woman on my board. I think they think it'll look bad. Even if they have legitimate reasons like, oh they're board size is already maxed out or there's less interest in their industry or what have you.

Jennifer B:
Right.

Anastasia Boden:
It's very hard to find someone willing to step up.

Jennifer B:
That was a very good point. Could a potential male board member who wasn't offered a spot, could that be a potential plaintiff or it would have to be the company?

Anastasia Boden:
Yeah, no we would definitely be interested in looking at somebody who was kicked off their board or removed from the board in order to make way for a woman. The companies still have until the end of the year to comply. So we're waiting to see kind of how it all shakes out. But certainly we would encourage somebody to call us because we exist to protect the constitutional rights of people when the government does offensive things like this. So we're very happy to consider a lawsuit.

Jennifer B:
And how could somebody get in touch with you if they thought they had a claim or they wanted to try to fight this?

Anastasia Boden:
Well, our website is pacificlegal.org. We encourage anybody to call us, to email us, to go to our website, to contact me on Twitter. Any which way we're open to hearing from people.

Jennifer B:
What's your Twitter handle? We could share that with our listeners.

Anastasia Boden:
Yeah, my Twitter handle is anastasia_esq.

Jennifer B:
Esquire, yes?

Anastasia Boden:
Yes, right.

Jennifer B:
Got it. Now I actually live in Massachusetts and you probably know that we have a bill pending in our state legislature that's similar to the California law. It would only apply to public boards. So it would require, with the governor when he makes those appointments to balance the gender, and I believe also racial mix of the people on the boards. But so how common is this? You mentioned Illinois, I know it's happening here in Massachusetts. Are there any other states that you know of that are passing measures like this or already have?

Anastasia Boden:
So far we've heard about Illinois, New Jersey and I had heard about Massachusetts. What's interesting is California, of course it's just a straight woman quota, but in other states there has been, it's been proposed that they add a racial component. And I thought it was interesting in Illinois, it started out that the mandate was going to be you have to have at least one woman and at least one African American. And then when the bill was going through the legislature, other interest groups started haggling over, well we want to have a spot reserved for our race.

Jennifer B:
Really?

Anastasia Boden:
Yeah, and then the other group speaks up and says, no, we don't think your group deserves it. And it just goes to show how ugly and messy this is when we start allowing the government to hand out benefits or burdens based on race. You get these arguments across race lines that just exacerbate racial tensions and create animosity based on racial lines. And it was such an ugly process to see.

Jennifer B:
Yeah, that's really interesting. And then you don't see that as much with gender because it's just women are 50% of the population. And I bet you're right that a lot of companies will just say, well, it's not the end of the world. We'll just comply with the law and we don't actually have a lot to lose in terms of ... Well maybe they do have a lot to lose in terms of corporate revenue. I don't know. I don't know how it, how it plays out. I would imagine it's really just kind of facial, right, that it's all about marketing. And so maybe they can use it to their advantage and won't end up challenging it. But it does seem like somebody should, because it raises so many issues of equal protection. Especially when you get into the race aspect, I think it has even more serious implications.

Anastasia Boden:
Yeah, absolutely and it's just going to stay on the books under this, it's supposed to be some happy, nice thing. And it's exactly what Governor Brown said. He said, well, we think it's probably, has some legal infirmities but states are not getting the message about female equality. And I guess I would ask what message it actually sends? To me, I thought it was horrible when it was passed. I was so offended when I read that. That the government, it's so utterly patronizing to say, here, let us help you. You're not able to do it. Let us give you a leg up because you can't make it there on your own. When in fact I think women are capable and are making it there on their own. It confirms women's worst fears, that they're being discriminated against rather than empowering them and focusing on all they're accomplishing in the absence of a handout.

Jennifer B:
Right. Well our listeners can can read more about this issue if they go onto the Los Angeles Times website and look for your column, which I believe appeared on July 8th. And they could probably also find it on the website of the Pacific Legal Foundation. Is that right?

Anastasia Boden:
That's right. You can go to our blog and read more about our work in this area and other areas of constitutional law, and check out a link to this article on the Pacific Legal blog.

Jennifer B:
Awesome. And I also have a blog on the topic where I quote your piece, which is on iwf.org. So we hope you learned something new from today's conversation. If you enjoyed this episode of She Thinks we would love it if you would take a moment to leave us a rating or a review on iTunes. And please share this episode with your friends on social media. From all of us here at Independent Women's Forum, you're in control. I think, you think, she thinks.


Go Back



Independent Women's Forum is an educational 501(c)(3) dedicated to developing and advancing policies that aren’t just well intended, but actually enhance people’s freedom, choices, and opportunities. IWF is the sister organization of the Independent Women’s Voice.​
Follow us