Diversity Disclosure Rules Thrive as Mandates Die in Court (1)

Diversity on corporate boards of directors is more likely to be advanced with disclosure rules than specific quotas, after a pair of courtroom defeats for California laws that included gender and racial mandates.

The California laws required publicly traded companies with headquarters in the state to have at least one female director, and one person from an underrepresented group on their board, depending on board size. The laws imposed financial penalties of up to $300,000 for noncompliance.

Two California state judges struck down the laws in separate decisions in April and May. But other states increasingly are passing disclosure laws ...