However, if the pool of qualified female director candidates is limited, firms will incur costs from the appointment of inexperienced or less qualified directors that can outweigh the benefits of increased gender diversity.By perturbing an equilibrium outcome in the director labor market, board mandates can also impose externalities on firms that rely on a shared director labor market.Any opinions in the examples do not represent the opinion of the Cambridge Dictionary editors or of Cambridge University Press or its licensors.In December, Paul, Weiss, Rifkind, Wharton & Garrison got some bad press for what was supposed to be a happy occasion.As in 1954, it was necessary to make a choice between urgent and less urgent mandates.That was not a call for the United Nations to do less (though that might be one result). The review could have a lasting impact not only on what the Organization did, but on how it did it.At the World Summit at UN Headquarters in September 2005, Member States asked Secretary-General Kofi Annan to “review all mandates older than five years”, and to provide an analysis and make recommendations to facilitate that review.Following up on that request, Secretary-General Annan presented his report on mandating and delivering to the UN General Assembly on 30 March 2006.
Secretary-General Annan said that was even truer in 2006, when the number of mandates were so much greater.
Sunwoo Hwang is a Ph D candidate at the University of North Carolina Kenan-Flagler Business School; Anil Shivdasani is the Wells Fargo Distinguished Professor of Finance at the University of North Carolina Kenan-Flagler Business School; and Elena Simintzi is Assistant Professor of Finance at the University of North Carolina Kenan-Flagler Business School. On September 30, 2018, California enacted Senate Bill 826 mandating that all publicly-traded companies headquartered in the state to have at least one female director by the end of 2019.
The law further requires that by year-end 2021, all firms have at least one female director if the board has four members or fewer, two female directors if the board has five members, and three female directors if the board has six members or more.
With the passage of this law, California has become the first state in the United States to mandate female directors on boards of publicly held firms.
Not surprisingly, the law has generated substantial debate with proponents praising efforts towards balanced gender representation.