Cal­i­for­nia cor­po­rate boards are mostly all white, study says

Merced Sun-Star - - Front Page - BY KIM BOJÓRQUEZ kbo­

Lati­nas are un­der­rep­re­sented on Cal­i­for­nia cor­po­rate boards of di­rec­tors de­spite re­cent ef­forts to com­pel busi­nesses to bring more women into lead­er­ship po­si­tions, ac­cord­ing to a new anal­y­sis con­ducted by a Latino ad­vo­cacy group.

The study found Lati­nas make up 3.3% of board mem­ber seats in a state where Lati­nos ac­count for 39% of the state pop­u­la­tion.

The anal­y­sis of 662 Cal­i­for­nia head­quar­tered, pub­lic com­pa­nies, con­ducted by the Latino Cor­po­rate Di­rec­tors As­so­ci­a­tion, iden­ti­fied that 35%, or 233 com­pa­nies, of boards are all-white boards, with no eth­nic of racial di­ver­sity.

Of the 511 pub­lic board seats filled by women as of March 1, white women ac­count for 77.9% of seats, fol­lowed by Asian women, 11.5%, and African Amer­i­can women, 5.3%. Of the 662 com­pa­nies, 65% com­pa­nies have at least one eth­nic or racially di­verse board mem­ber, ac­cord­ing to the re­view.

“We see a lot of white women be­ing ap­pointed to boards, whereas women of color are left out,” said Kathy Ju­rado Munoz, ad­vo­cacy and de­mand vice pres­i­dent for the Latino Cor­po­rate Di­rec­tors As­so­ci­a­tion.

The study fol­lows Cal­i­for­nia’s adop­tion of a 2018 law signed by former Gov. Jerry Brown that re­quires pub­licly traded cor­po­ra­tions to ap­point women to their boards of di­rec­tors.

Its crit­ics re­fer to the law as a “women quota,” and con­ser­va­tive or­ga­ni­za­tions have sued to over­turn it. So far, it has held up in court with a

fed­eral judge in April dis­miss­ing a law­suit filed by the Pa­cific Le­gal Foun­da­tion on be­half of a share­holder in a se­cu­rity sys­tems man­u­fac­turer.

“Cal­i­for­nia law­mak­ers and cor­po­rate Amer­ica must un­der­stand that gen­der di­ver­sity is not enough,” Linda Griego, former deputy mayor of Los Angeles said in a state­ment. “An all-white male and fe­male board of di­rec­tors is not di­verse.”

Law­mak­ers have put for­ward a bill that would com­pel cor­po­ra­tions to ap­point more di­verse boards of di­rec­tors.

As­sem­bly Bill 979, jointly au­thored by As­sem­bly mem­bers Chris Holden, D-Pasadena, and Cristina Gar­cia, D-Bell Gar­dens, would re­quire a cor­po­ra­tion to have at least one di­rec­tor from an un­der­rep­re­sented com­mu­nity serve on its board by the end of 2021 . An un­der­rep­re­sented in­di­vid­ual is de­fined in the bill as African Amer­i­can, His­panic or Na­tive Amer­i­can.

If a cor­po­ra­tion’s num­ber of board di­rec­tors is nine or over, the board would have to in­clude a min­i­mum of three di­rec­tors from un­der­rep­re­sented com­mu­ni­ties by 2023, ac­cord­ing to the bill. The bill would also re­quire the Sec­re­tary of State to pub­lish re­ports on its web­site on the boards of di­rec­tors that are in com­pli­ance and fine those in vi­o­la­tion.

It is await­ing a com­mit­tee hear­ing.

“To have cor­po­ra­tions head­quar­tered in the state of Cal­i­for­nia, and have boards that don’t re­flect the di­ver­sity of the state — it cries out for at­ten­tion and there needs to be some ac­tion taken to re­verse that,” Holden told The Sacra­mento Bee.

In a state­ment, the bill’s prin­ci­pal co-au­thor Assem­bly­woman Eloise Gómez Reyes, D-San Ber­nandino, called the bill a “crit­i­cal step.”

“If we ex­pect great pol­icy to come from any group or or­ga­ni­za­tion we need to en­sure that at the core, there is di­ver­sity in its mem­bers. Di­ver­sity brings per­spec­tive and in­sight that oth­er­wise wouldn’t be present,” Gómez Reyes said.” If you don’t have di­ver­sity you will never achieve great change.”

While the Latino Cor­po­rate Di­rec­tors As­so­ci­a­tion isn’t ad­vo­cat­ing for man­dates to di­ver­sify Cal­i­for­nia’s boards, Ju­rado Munoz be­lieves it’s cru­cial that cor­po­ra­tions be more trans­par­ent about the gen­der and racial make up of their board of di­rec­tors.

“We ab­so­lutely be­lieve that what gets mea­sured, gets re­sults,” said Monique Navarro, man­ager of mar­ket­ing and com­mu­ni­ca­tions for the Latino Cor­po­rate Di­rec­tors As­so­ci­a­tion. “We want com­pa­nies to be aware.”

Ozzie Gro­mada Meza, di­rec­tor of mem­ber­ship and re­search at the Latino Cor­po­rate Di­rec­tors As­so­ci­a­tion, said the ma­jor­ity of place­ments on boards are done through a re­fer­ral or through a re­cruiter’s own net­work.

As on­go­ing protests con­tinue over racial in­equal­ity around the coun­try, Gro­mada Meza said it’s more im­por­tant than ever to have ex­ec­u­tives or board di­rec­tors who are rep­re­sen­ta­tive of its cus­tomer and em­ployee base.

“We strongly rec­om­mend think­ing out­side the box and en­sur­ing that they look at in­di­vid­u­als that could be un­der the radar,” he said.

Other meth­ods to di­ver­sify a board, he said, in­clude com­pa­nies build­ing di­verse part­ner­ships or work­ing with search firms that fo­cus on re­cruit­ing di­verse can­di­dates. The as­so­ci­a­tion is also fo­cused on cre­at­ing a pipe­line of fu­ture di­verse board di­rec­tors.

Col­lege en­roll­ment among U.S. Lati­nos is in­creas­ing, ac­cord­ing to the Na­tional Cen­ter for Ed­u­ca­tion Sta­tis­tics. Between 2000 and 2018, His­panic en­roll­ment in­creased from 1.4 mil­lion to 3.4 mil­lion stu­dents, or 148%.

“They’ve got the de­grees, they’re work­ing in these pub­lic cor­po­ra­tions. There needs to be ef­forts made,” Ju­rado Munoz said.

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