Bill 979 can affect 14 different real estate companies that only have whiteboards (Photo credit: Warrick Page / Getty Images and Mario Tama / Getty Images).
California lawmakers passed law on Monday that would force AECOM, Douglas Emmett, and other real estate companies to include racial minority or LGBT people on its board of directors if the law was signed.
Legislature revived the Assembly's Law 979 during this legislative term (a measure first introduced in February 2019) amid a national police settling of racial relations following the deaths of George Floyd and other blacks. Many industries have looked at their hiring and representation practices, including real estate, which is still dominated by white men.
AB 979 is following in the footsteps of 2018 legislation that required California-based companies to have at least one woman on their boards.
Governor Gavin Newsom has neither signed the bill nor given his position on the measure. A message left in the governor's office on Wednesday has not been returned.
According to the original version of AB 979, all publicly traded companies based in California would have to have a non-white person on their boards by the end of 2021.
The bill was amended last month in a Senate Funds Committee debate to expand the requirement for an "underrepresented community" identified in the bill as "Black, African-American, Hispanic, Latino, Asian, Pacific Islander, American Indian, Hawaiian, or Alaskan" The definition is native or anyone who identifies as lesbian, bisexual or transgender. "
Since most board members do not disclose their sexual identity or gender history, it is unclear which companies would be legally required to make changes. However, a July report by the Latino Corporate Directors Association shows that 233 of the 662 publicly traded companies in California, or 35 percent, have whiteboards only.
This includes 14 real estate companies, including construction and engineering giant AECOM, L.A. County's most prolific construction company.
Douglas Emmett, one of the largest and most active REITs in the region, would also be affected.
Other all-white real estate companies with market caps greater than $ 1 billion include: American Homes 4 Rent, an Agoura Hills-based rental housing investor, Sabra Health Care, an Irvine-based commercial real estate investor, and PS Business Bark, an in Glendale based office REIT.
PS Business Park referred to a public filing claiming the company has met current and potential state diversity requirements. Messages left with other companies on Wednesday were not returned immediately.
The law's sponsors, including Congregation member Chris Holden from Pasadena, have described it as a way to contain all-white boards in Silicon Valley. However, the Latino Corporate Directors' report notes that all-white boards are not industry specific, with companies from Monster Beverage to Chipotle Mexican Grill making the list.