LGBTQ group disappointed as court rules diversity law unconstitutional

Members of LGBTQ and other minority business associations have expressed disappointment over a recent court ruling that ruled a California law aimed at increasing diversity on corporate boards was unconstitutional.

A Southern California judge has ruled on legislation to broaden access to the state’s powerful business community for those rarely seen in its boardrooms, including LGBTQ people.

By identifying many ethnic, racial and sexual minorities and mandating their inclusion on the boards of California-based publicly traded companies, Assembly Bill 979, signed into law on September 30, 2020, broadened the pool of talents of those who could serve on executive offices and boards of directors. , similar to Senate Bill 826, which passed in 2018 and aimed to increase the representation of women on those same boards and offices.

It didn’t last long. Earlier this month, on April 1 to be exact, Los Angeles County Superior Court Judge Terry Green, appointed by then-Governor Pete Wilson (R), ruled in favor of the three plaintiffs who brought an action against the law on the day of its signing. by Governor Gavin Newsom, after determining that it violated the California Constitution. They were represented by Judicial Watch, a conservative group best known for its lawsuits against the Clinton administration and for its active role in former President Donald Trump’s efforts to overturn the 2020 election results in court. Joe Kocurek, press secretary for California Secretary of State Shirley N. Weber, told the Bay Area Reporter that the office still hasn’t decided whether to pursue an appeal.

Written primarily by Assembly members Chris Holden (D-Pasadena), Christina Garcia (D-Bell Gardens), and then-San Francisco Representative David Chiu, who resigned to become San Francisco City Attorney last November , the law was designed to increase the presence of several defined minority groups on the boards of directors of all California public companies with a primary executive office in the state and securities listed on a major US stock exchange. Chiu did not immediately return a request for comment to the BAR.

Members of the Diverse Corporate Directors Coalition, which includes Out Leadership’s OutQuorum, said they were disappointed with the judge’s ruling.

“The need for corporate America to embrace diversity in the boardroom has never been greater,” the DCDC said in a press release.

The coalition noted that the law was designed as a response to decades of inaction on diversity on boards. “Recently, the representation of women and minorities has increased slightly, but representation remains abysmal and the pace of change is slow,” the coalition said.

Calling it a “frustrating setback” but not entirely dismayed, Out Leadership founder Todd Sears said in a press release “we believe this is just one battle lost in a war won over many fronts. In fact, diversity gains are being made in powerful boardrooms and C-suites across the country and around the world, especially without regulatory mandates.”

Out Leadership is an organization dedicated to “making LGBTQ+ equality a priority in global C-Suites,” the senior executives who run corporate headquarters nationwide.

“Anytime you have a decision against something considered progressive, it can be a challenge, but it can also be an opportunity,” Sears said in a phone call from New York. The way Green struck down the law, Sears said, was based more on legality than the spirit of the law.

An area for improvement
While conservative groups were pleased with Green’s findings, an article in the conservative National Law Review noted that the law itself was intended to address an area that needs improvement.

“Corporate inclusiveness efforts, whether at the board, management and/or workforce level, can bring the added benefit of general goodwill among employees, consumers and shareholders”, read an article Published by NLR on April 16.

Indeed, the law itself described the circumstances he was supposed to improve by noting that “only 31% of African Americans and 22% of Latinos worked in management, professional and related professions while 54% of Asians and 41% of whites worked in the same occupation and “the percentages of seats on the board of directors of a Fortune 500 company held by individuals who identified as African American/Black, Hispanic/Latino(a), and Asian/Pacific Islander were 8.6%, respectively, 3.8% and 3.7%”, among many other points. The bill was amended in August 2020 to include members of the LGBTQ community.

Green vegetables 24 page decision even supports the idea that the law was trying to address:

“This litigation arose because the Legislative Assembly identified a problem: Board seats generally belong to members of one race, sexual orientation, and gender identity,” Green wrote. . “Upon further investigation, they concluded that this disparity was the result, conscious or unconscious, of a process that leads board members to select replacements who look and feel like them. This meant that qualified members other groups were, intentionally or not, excluded.”

The problem, he found, was that AB 979 violated the equal protection clause of the state constitution.

“If demographically homogeneous councils are a problem,” Green continued, “then heterogeneous councils are the immediate and obvious solution. thinks in groups But the California Constitution protects the right of individuals to equal treatment Before the legislature can require members of a group to get certain seats on the board of directors, it must first try to create neutral conditions in which qualified individuals of any group can succeed. attempt was not made in this case.”

Assembly Bill 979 was, according to Green, a clumsy approach to dealing with a real problem.

“Only in very special cases should discrimination be corrected by more discrimination,” he wrote. “And that should only happen after trying obvious alternative measures. Sometimes the direct approach should be the last resort, not the first.”

Judicial Watch certainly couldn’t have been happier.

“This landmark California court decision has declared unconstitutional one of the most egregious and significant attacks of the modern era on constitutional prohibitions against discrimination,” the organization said in an April 1 statement on its website. “In today’s decision, the court upheld the fundamental American value of equal protection under the law. Judicial Watch’s taxpayer clients are heroes for defending civil rights against the left’s malign efforts to override anti-discrimination protections.”

Sears, however, remains optimistic. Companies see the benefits of having more diversity, including LGBTQ diversity, on their boards and in their executive offices, he said. In particular, Gen Z (those born between 1997 and 2012), 21% of whose members identify as LGBTQ according to a recent Gallup poll, “expect and demand” that kind of diversity, Sears added.

More and more companies are trying to diversify their C-Suites and their boards, he said, because all of those things are “fundamentally good for business.”

The U.S. Securities and Exchange Commission is already on track with those efforts, Sears said, and encourages companies to do the same. And the talent is there. His organization maintains a list of 2,000 potential board members who are ready to work, he said.

“Diversity is fundamentally good for business,” Sears said. “Diversity leads to better decisions.”

LGBTQ Agenda is an online column that appears weekly. Got a tip on queer news? Contact Eric Burkett at

Help keep the Bay Area Reporter going during these trying times. To support local, independent and LGBTQ journalism, consider become a member of the BAR.