Happy Friday, all.
I took this photo last weekend. This is Lake Michigan in Holland. The water is frozen, but the lakeshore is still beautiful.
Yesterday Senate Bill 115 was introduced: Check it out here
This Bill would require any publicly traded corporation to phase in over a specified time period at least one female director on its board, up to 3 female directors.
The Bill would also require publication of those corporations in compliance and impose stiff penalties for those out of compliance – $100,000 up to $300,000 for repeat violations.
Please keep in mind – this Bill would not affect privately held corporations (corporations whose company stock is privately held.
I think of Olga Mack who founded Women Serve on Boards – described as a”movement that advocates for women to serve on corporate boards of Fortune 500 companies“
From everything that I have seen, Olga is doing excellent work driving change for more women in Leadership.
Updated September 12, 2019 Since this Bill was proposed on February 14, 2019 it has been stuck in the economic and small business development committee.
Board Diversity is a Good Thing.
If I put on my “corporate board governance” hat – I agree that in order to be effective, an organization needs a diverse background represented on its board of directors. I appreciate this Bill’s intention of encouraging publicly traded corporations to be more intentional about seeking out women in these key leadership roles.
That being said, I am doubtful that this Bill will move forward. To support my thought process, I will look no further than to the history of BCorp Legislation in Michigan.
BCorps
I look at all the push to make Michigan one of the majority of states where entrepreneurs have a viable legal option to do business in the State of Michigan as BCorps. House Bills 5867, 5868 & 5869 were introduced on April 24, 2018, that would allow BCorps to be formed under Michigan Law. A few years before that the legislature proposed similar legislation which died in committee. For a review of the Former BCorp Bills, the House Fiscal Agency issued a Fiscal Analysis, check it out here.
Despite the overall popularity of BCorps, the growing trend in businesses to be socially-minded, these BCorp Bills died in committee – just like their predecessors in years past.
For its part, Senate Bill 119 would create a significant obligation on publicly held corporations doing business in the State of Michigan.
Based upon the Michigan Legislature’s failure to enact BCorp legislation over the years, I am hard pressed to believe Senate Bill 119 stands a chance. I am guessing it will also die in committee.
Questions? Comments?
Jeshua@dwlawpc.com
Purpose Driven General Counsel 