Corporate gender quotas reinforce privilege
Progressives often support diversity mandates as a path to equality and a way to level the proverbial playing field. But all too often such policies are a disingenuous form of virtue-signaling that benefits only the most privileged and does little to help average people.
A pair of bills sponsored by Massachusetts state Senator Jason Lewis and House Speaker Pro Tempore Patricia Haddad, to ensure “gender parity” on boards and commissions, provide a case in point.
Haddad and Lewis are concerned that more than half the state-government boards are less than 40 percent female. Haddad claims legislators have a “strong obligation” to rectify the situation. Lewis describes the issue as “critically important.”
In order to ensure that elite women have more such opportunities, the duo have proposed imposing government quotas. If the bills become law, state boards and commissions will be required to set aside 50 percent of board seats for women by 2022. (The bill defines “woman” as any individual “who self-identifies her gender as a woman, without regard to the individual’s designated sex at birth.”)
Not content to impose Soviet-style quotas on state-appointed boards, Lewis also wants to subject the private sector to social engineering. His second bill would require publicly held corporations headquartered in Massachusetts to have at least one female director by 2022. By 2024, private companies with six or more directors would be required to have a minimum of three women on the board. Failure to comply could result in fines of up to $100,000.
The proposal is similar to a measure recently adopted in California, which last year became the first state to require gender quotas for private companies.
In signing the measure, California Governor Jerry Brown admitted that the law, which expressly classifies people on the basis of sex, is probably unconstitutional.
The US Supreme Court frowns on sex-based classifications unless they are designed to address an “important” policy interest (such as privacy or safety). Because the California law applies to all boards, even where there is no history of prior discrimination, courts are likely to rule that the law violates the constitutional guarantee of “equal protection.”
But are such government mandates even necessary? Female participation on corporate boards may not currently mirror the percentage of women in the general population, but so what?
The number of women on corporate boards has been steadily increasing without government meddling. According to a study by Catalyst, between 2010 and 2015 the share of women on the boards of global corporations increased by 54 percent. And their numbers are still growing.
To be sure, women in 2015 still held only 15 percent of seats on global corporate boards, but the free market is clearly pushing companies in the right direction.
Requiring companies to make gender the primary qualification for board membership will inevitably lead to less qualified private sector boards. That is exactly what happened when Norway adopted a nationwide corporate gender quota. According to a 2012 paper by USC professor Kenneth R. Ahern and University of Michigan professor Amy K. Dittmar, Norway’s gender quota “led to younger and less experienced boards . . . and deterioration in operating performance, consistent with less capable boards.”
Advocates of state-mandated quotas may believe that less-experienced boards are a necessary price to pay to change corporate culture and increase leadership opportunities for women. But gender quotas do nothing of the sort.
Norway is once again instructive, since that country’s gender quotas have not had significant effect on corporate culture or led to the promotion of more women throughout the ranks. In fact, the only thing Norway’s gender quotas have done is benefit the individual women actually selected to serve on the corporate boards.
Writing in The New Republic, Alice Lee notes that increasing the number of opportunities for board membership without increasing the pool of qualified women to serve on such boards has led to a “golden skirt” phenomenon, where the same elite women scoop up multiple seats on a variety of boards.
Next time somebody pushes corporate quotas as a way to promote gender equity, remember that such policies (even if constitutional) are largely self-serving measures that make their sponsors feel good but do little to help average women.
Jennifer C. Braceras is director of the Center for Law & Liberty at Independent Women’s Forum.