State Initiatives to Increase Diversity on Boards Continue but May Face Challenges

On August 27, 2019, the Illinois General Assembly passed a bill requiring publicly traded companies with principal offices in Illinois to report to the Secretary of State the number of women and minorities on their boards, as well as plans to promote diversity in the company. The bill also requires the University of Illinois to study the reported data and publicly publish a rating on each company’s efforts to increase their board diversity. Similar bills have been introduced in New York and Maryland seeking to require boards to disclose the gender and/or racial diversity of their boards while bills seeking to mandate gender diversity have been introduced in Michigan, New Jersey and Pennsylvania. It remains to be seen whether such bills will pass, particularly in light of a recently filed lawsuit seeking to prevent the implementation and enforcement of California’s gender diversity bill, which served as the model for each of these bills. The full text of the Illinois law is available here. The complaint challenging the California law is available here.