California law will force women to sit on boards of directors

The bill requires that every publicly traded company headquartered in California have at least one woman on its board of directors by the end of 2019, according to the Los Angeles Times. Companies with six or more members on their board of directors will need to have at least three women by the end of 2021.

According to the Associated Press, companies will be fined $ 100,000 the first year they fail to meet these requirements and $ 300,000 for each additional non-compliant year. They will also be fined $ 100,000 if they do not report their board's report to that of California.

The text of the bill suggests that promoting gender equality in boards of directors will not only improve opportunities for women and girls, but will also improve productivity, citing a 2014 Credit Suisse study. 10.1% while companies with at least one female director have an average return on equity of 12.2%.

Critics of the bill, however, say it will be harder for companies to improve racial and ethnic diversity. Jennifer Barrera, senior vice president of the California Chamber of Commerce, told the AP that the bill "creates a challenge for a board of directors to achieve business goals." diversity ".

Still others dispute the legality of the bill. "I'm not at all convinced that it would go through a legal rally," said Jessica Levinson, a professor at Loyola Law School in the Los Angeles Times. "It's an obvious gender preference in the sense that you say you have to select women and get them involved in counseling." The question is whether you can make that preference and whether it will hurt men. "

Nevertheless, the authors of the bill maintain that the measure is necessary to achieve a better representation of women. "We know that when boards are diverse and women's voices are heard, it's better for the entire workforce," said Senator Connie Leyva in San Francisco Chronicle. She says that Senate Bill 826 sends "a great message to the women we value them, we respect them here in California".

Do you like this story? Subscribe to CNBC Make It on YouTube!

Do not miss: