Signed by Governor Gavin Newsom

Vote Smart's Synopsis:

Vote to concur with Senate amendments and pass a bill that requires corporations to have a certain number of individuals from under-represented communities on the board of directors.

Highlights:

• Requires a publicly held domestic or foreign corporation whose principal executive offices are located in California to have a minimum of one director from an underrepresented community on its board, no later than the close of the 2021 calendar year (Sec. 3).

• Requires a publicly held domestic or foreign corporation whose principal executive offices are located in California, no later than the close of the 2022 calendar year, to comply with the following (Sec. 3):

• If its number of directors is 9 or more, the corporation must have a minimum of 3 directors from underrepresented communities;

• If its number of directors is more than 4 but fewer than 9, the corporation must have a minimum of 2 directors from underrepresented communities; or

• If its number of directors is 4 or fewer, the corporation must have a minimum of one director from an underrepresented community.

• Requires the Secretary of State, no later than March 1, 2022, and annually thereafter, to include in its report at a minimum, (Sec. 3):

• The number of corporations subject to this section that were in compliance with the requirements of this section during at least one point during the preceding calendar year;

• The number of publicly held corporations that moved their United States headquarters to California from another state or out of California into another state during the preceding calendar year; and

• The number of publicly held corporations that were subject to this section during the preceding year, but are no longer publicly traded.

• Authorizes the Secretary of State to impose fines for violations of this section as follows (Sec. 3):

• For failure to timely file board member information with the Secretary of State, the amount of $100,000;

• For a first violation, the amount of $100,000; and

• For a second or subsequent violation, the amount of $300,000.

• Defines “director from an underrepresented community” as an individual who self-identifies as Black, African American, Hispanic, Latino, Asian, Pacific Islander, Native American, Native Hawaiian, or Alaska Native, or who identifies as gay, lesbian, bisexual, or transgender (Sec. 3).

Full Bill Text

Vote Smart's Synopsis:

Vote to amend and pass a bill that requires corporations to have a certain number of individuals from underrepresented communities on the board of directors.

Highlights:

• Requires a publicly held domestic or foreign corporation whose principal executive offices are located in California to have a minimum of one director from an underrepresented community on its board, no later than the close of the 2021 calendar year (Sec. 3).

• Requires a publicly held domestic or foreign corporation whose principal executive offices are located in California, no later than the close of the 2022 calendar year, to comply with the following (Sec. 3):

• If its number of directors is 9 or more, the corporation must have a minimum of 3 directors from underrepresented communities;

• If its number of directors is more than 4 but fewer than 9, the corporation must have a minimum of 2 directors from underrepresented communities; or

• If its number of directors is 4 or fewer, the corporation must have a minimum of one director from an underrepresented community.

• Requires the Secretary of State, no later than March 1, 2022, and annually thereafter, to include in its report at a minimum, (Sec. 3):

• The number of corporations subject to this section that were in compliance with the requirements of this section during at least one point during the preceding calendar year;

• The number of publicly held corporations that moved their United States headquarters to California from another state or out of California into another state during the preceding calendar year; and

• The number of publicly held corporations that were subject to this section during the preceding year, but are no longer publicly traded.

• Authorizes the Secretary of State to impose fines for violations of this section as follows (Sec. 3):

• For failure to timely file board member information with the Secretary of State, the amount of $100,000;

• For a first violation, the amount of $100,000; and

• For a second or subsequent violation, the amount of $300,000.

• Defines “director from an underrepresented community” as an individual who self-identifies as Black, African American, Hispanic, Latino, Asian, Pacific Islander, Native American, Native Hawaiian, or Alaska Native, or who identifies as gay, lesbian, bisexual, or transgender (Sec. 3).

Full Bill Text

Vote Smart's Synopsis:

Vote to pass a bill that requires corporations to have a certain number of individuals from underrepresented communities on the board of directors.

Highlights:

• Requires a publicly held domestic or foreign corporation whose principal executive offices are located in California to have a minimum of one director from an underrepresented community on its board, no later than the close of the 2021 calendar year (Sec. 3).

• Requires a publicly held domestic or foreign corporation whose principal executive offices are located in California, no later than the close of the 2022 calendar year, to comply with the following (Sec. 3):

• If its number of directors is 9 or more, the corporation must have a minimum of 3 directors from underrepresented communities;

• If its number of directors is more than 4 but fewer than 9, the corporation must have a minimum of 2 directors from underrepresented communities; or

• If its number of directors is 4 or fewer, the corporation must have a minimum of one director from an underrepresented community.

• Requires the Secretary of State to include in its report the number of domestic and foreign corporations whose principal executive offices are located in California and who have at least one director from an underrepresented community, no later than July 1, 2021 (Sec. 3).

• Requires the Secretary of State, no later than March 1, 2022, and annually thereafter, to include in its report at a minimum, (Sec. 3):

• The number of corporations subject to this section that were in compliance with the requirements of this section during at least one point during the preceding calendar year;

• The number of publicly held corporations that moved their United States headquarters to California from another state or out of California into another state during the preceding calendar year; and

• The number of publicly held corporations that were subject to this section during the preceding year, but are no longer publicly traded.

• Authorizes the Secretary of State to impose fines for violations of this section as follows (Sec. 3):

• For failure to timely file board member information with the Secretary of State, the amount of $100,000;

• For a first violation, the amount of $100,000; and

• For a second or subsequent violation, the amount of $300,000.

• Defines “director from an underrepresented community” as an individual who self-identifies as African American, Hispanic, or Native American (Sec. 3).

Full Bill Text