California recently passed Senate Bill 826, a law requiring all publicly held corporations based in the state to have a minimum number of women on their boards. A corporation with four or fewer directors must have at least one woman on its board. If the board has five members, at least two women must be on it. If it has six or more, there must be at least three women. In his official signing statement, California Governor Jerry Brown praised the law, but also noted that “serious legal concerns have been raised” and that “these potential flaws may… prove fatal to its ultimate implementation.” Governor Brown is right to worry. The law is clearly unconstitutional under current Supreme Court precedent. If it survives the nearly inevitable legal challenges, it is also likely to cause more harm than good.
The Supreme Court has long held that laws that discriminate on the basis of sex are subject to heightened “intermediate scrutiny” under the Equal Protection Clause of the Fourteenth Amendment. This test requires all such laws to be “substantially related” to an “important” state interest. In other words, the law must serve an important objective and there has to be a close fit between the discriminatory policy and the interest it supposedly advances, so as to prevent the state from engaging in any more sex discrimination than is actually needed to achieve its “important” objective.
In United States v. Virginia (1996), the Court arguably tightened up the standard still further, emphasizing that sex-discriminatory laws must have an “exceedingly persuasive justification.” It is important to emphasize that this kind of heightened scrutiny applies even if the law is well-intentioned and not motivated invidious prejudice or by a desire to subordinate one gender to the other. Indeed, Indeed, Craig v. Boren (1976), the case where the Supreme Court first ruled that gender classifications are subject to heightened judicial scrutiny struck down an Oklahoma law that forbade 18-20 year old men, but not 18-20 year old women to buy 3.2% beer. No one could plausibly claim that the Oklahoma state legislature in the 1970s was some kind of matriarchy seeking to persecute men. But the law was invalidated anyway.
California’s gender-quota for corporate boards clearly discriminates on the basis of sex, and it also clearly flunks intermediate scrutiny. The most obvious interest it might serve is overcoming the (very real) history of discrimination against women in the corporate world. That likely qualifies as an “important” state interest. But the fit between the end and the means is far too dubious to pass muster.
The law applies to all corporate boards of publicly traded firms, regardless of whether there is any significant recent history of discrimination at the firm, or in the industry in question. It also applies regardless of underlying distribution of interest in serving on boards in a given industry. It is hard to deny that some industries attract disproportionate interest from men, as opposed to women, and vice versa. Some of these differences in preferences are themselves the result of a history of sexism. But by no means all. For example, data suggest declining sexism may actually increase the proportion of women who avoid STEM fields in favor of pursuing other careers.