Testimonials
Default Banner Image

DIVERSITY IN BOARDS OF DIRECTORS IS NOW MANDATED BY LAW

Last fall, Governor Newsom signed into law Assembly Bill 979 (AB-979) mandating that all California based public company board of directors have at least one non-white board member by the end of 2021. By the end of 2022, boards with five to eight members will be required to have two directors from underrepresented groups and corporations with nine or more directors must have at least three directors from underrepresented communities.

Although public companies have until the end of 2021 or 2022 to make these changes, the replacement of board members can take time. And because AB-979 impacts how board members are removed or replaced, it also necessitates that corporations review and make changes to their bylaws.  Where compliance with the law will require the removal of any current board members, companies should be cautious—this type of adverse situation can be risky and expose the corporation to potential liability.

The new law is intended to achieve diversity on corporate boards but does not detail lawful methods for compliance with the requirements.  It essentially requires corporations to enact a strict quota system and requires decision-making based on protected classes.  It will be interesting to see what legal challenges arise from this.  If your company needs advice about diversity in your board of directors, give us a call and we will be happy to help.

--------------------------

This article is informational only and meant to provide guidance. It is not meant to be legal advice and it does not create an attorney-client relationship. For what to do in your specific situation, please consult with a qualified Construction Law attorney.

Testimonials

Mahyar was a big part in helping start our company and setting up our corporation. She also went to battle with a Billion dollar Corporation to keep our doors open when they tried everything to shut us down.

Danny Lamping

Classic Refrigeration Company

In 2008 -2009, our company was involved in a lawsuit with over 1 million dollars claimed against us. Mahyar Ghassemian handled our case expertly and conscientiously. She explained on a regular basis the progress of our case and how each of the actions of our opponent would ultimately affect our case. At no time did we feel alone or compromised as Mahyar boldly stayed her course which eventually provided us with the satisfactory outcome we had hoped to achieve. She will be our first call should the need arise in the future.

Kelly Owen

Clarion Construction, Inc.

Many years ago an insurance carrier hired Mahyar Ghassemian to defend my construction firm in civil litigation. Not only was Ms. Ghassemian very knowledgeable and competent regarding the legal proceedings, but she was also personally vested in our well-being; she cared what happened. She counseled us regarding the various options, listened to our input and proceeded accordingly. In multiple cases with Ms. Ghassemian, we have never experienced a negative outcome. Today my first call when a potential legal issue is on the horizon is to Ms. Ghassemian. She is both extremely effective and cost conscious.

Russell Patterson

The Patterson Company

Small Firm Value – Large Firm Expertise