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California Becomes First State To Require Female Board Members

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California Becomes First State To Require Female Board Members
By the end of next year, all publicly traded corporations headquartered in the state must have at least one woman board member.
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Corporate boards of public companies in California can no longer be made up of only men.

In a first for a U.S. state, Gov. Jerry Brown signed a measure Sunday that requires all publicly traded corporations with California headquarters to have at least one woman board member by the end of 2019.

About a quarter of public companies in California reported having no women on their boards. The bill points to several studies that show public companies "perform better" when women serve on their boards.

But critics argue the bill is unconstitutional. The California Chamber of Commerce says focusing on gender "potentially elevates it as a priority over other aspects of diversity."

Gov. Brown says although there are a number of objections to the legislation, "recent events in Washington, D.C. — and beyond — make it crystal clear that many are not getting the message."

The bill requires that by the end of 2021, any company with six or more board members must have at least three female members. Companies that fail to adhere to the new rule risk getting a $100,000 fine.