Text of IL SB 1730 (2021)

102ND GENERAL ASSEMBLY State of Illinois 2021 and 2022 SB1730 Introduced 2/26/2021, by Sen. Emil Jones, III SYNOPSIS AS INTRODUCED: 805 ILCS 5/8.12 Amends the Business Corporation Act of 1983. Provides that public corporations must report the self-identified sexual orientation and self-identified gender identity of it directors. Effective January 1, 2022. LRB102 14302 JLS 19654 b A BILL FOR SB1730LRB102 14302 JLS 19654 b 1 AN ACT concerning business. 2 Be it enacted by the People of the State of Illinois, 3represented in the General Assembly: 4 Section 5. The Business Corporation Act of 1983 is amended 5by changing Section 8.12 as follows: 6 (805 ILCS 5/8.12) 7 Sec. 8.12. Female, and minority, and LGBTQ directors. 8 (a) Findings and purpose. The General Assembly finds that 9women, and minorities, and LGBTQ people are still largely 10underrepresented nationally in positions of corporate 11authority, such as serving as a director on a corporation's 12board of directors. This low representation could be 13contributing to the disparity seen in wages made by females 14and minorities versus their white male counterparts. Increased 15representation of these individuals as directors on boards of 16directors for corporations may boost the Illinois economy, 17improve opportunities for women, and minorities, and LGBTQ 18people in the workplace, and foster an environment in Illinois 19where the business community is representative of our 20residents. Therefore, it is the intent of the General Assembly 21to gather more data and study this issue within the State so 22that effective policy changes may be implemented to eliminate 23this disparity. SB1730- 2 -LRB102 14302 JLS 19654 b 1 (b) As used in this Section: 2 "Annual report" means the report submitted annually to the 3Secretary of State pursuant to this Act. 4 "Female" means a person who is a citizen or lawful 5permanent resident of the United States and who 6self-identifies as a woman, without regard to the individual's 7designated sex at birth. 8 "Minority person" means a person who is a citizen or 9lawful permanent resident of the United States and who is any 10of the following races or ethnicities: 11 (1) American Indian or Alaska Native (a person having 12 origins in any of the original peoples of North and South 13 America, including Central America, and who maintains 14 tribal affiliation or community attachment). 15 (2) Asian (a person having origins in any of the 16 original peoples of the Far East, Southeast Asia, or the 17 Indian subcontinent, including, but not limited to, 18 Cambodia, China, India, Japan, Korea, Malaysia, Pakistan, 19 the Philippine Islands, Thailand, and Vietnam). 20 (3) Black or African American (a person having origins 21 in any of the black racial groups of Africa). Terms such as 22 "Haitian" or "Negro" can be used in addition to "Black" or 23 "African American". 24 (4) Hispanic or Latino (a person of Cuban, Mexican, 25 Puerto Rican, South or Central American, or other Spanish 26 culture or origin, regardless of race). SB1730- 3 -LRB102 14302 JLS 19654 b 1 (5) Native Hawaiian or Other Pacific Islander (a 2 person having origins in any of the original peoples of 3 Hawaii, Guam, Samoa, or other Pacific Islands). 4 (6) "Publicly held domestic or foreign corporation" 5 means a corporation with outstanding shares listed on a 6 major United States stock exchange. 7 (c) Reporting to the Secretary of State. As soon as 8practical after the effective date of this amendatory Act of 9the 101st General Assembly, but no later than January 1, 2021, 10the following information shall be provided in a corporation's 11annual report submitted to the Secretary of State under this 12Act and made available by the Secretary of State to the public 13online as it is received: 14 (1) Whether the corporation is a publicly held 15 domestic or foreign corporation with its principal 16 executive office located in Illinois. 17 (2) Where the corporation is a publicly held domestic 18 or foreign corporation with its principal executive office 19 located in Illinois, data on specific qualifications, 20 skills, and experience that the corporation considers for 21 its board of directors, nominees for the board of 22 directors, and executive officers. 23 (3) Where the corporation is a publicly held domestic 24 or foreign corporation with its principal executive office 25 located in Illinois, the self-identified gender of each 26 member of its board of directors. SB1730- 4 -LRB102 14302 JLS 19654 b 1 (4) Where the corporation is a publicly held domestic 2 or foreign corporation with its principal executive office 3 located in Illinois, whether each member of its board of 4 directors self-identifies as a minority person and, if so, 5 which race or ethnicity to which the member belongs. 6 (5) Where the corporation is a publicly held domestic 7 or foreign corporation with its principal executive office 8 located in Illinois, the self-identified sexual 9 orientation of each member of its board of directors. 10 (6) Where the corporation is a publicly held domestic 11 or foreign corporation with its principal executive office 12 located in Illinois, the self-identified gender identity 13 of each member of its board of directors. 14 7 (5) Where the corporation is a publicly held 15 domestic or foreign corporation with its principal 16 executive office located in Illinois, a description of the 17 corporation's process for identifying and evaluating 18 nominees for the board of directors, including whether 19 and, if so, how demographic diversity is considered. 20 8 (6) Where the corporation is a publicly held 21 domestic or foreign corporation with its principal 22 executive office located in Illinois, a description of the 23 corporation's process for identifying and appointing 24 executive officers, including whether and, if so, how 25 demographic diversity is considered. 26 9 (7) Where the corporation is a publicly held SB1730- 5 -LRB102 14302 JLS 19654 b 1 domestic or foreign corporation with its principal 2 executive office located in Illinois, a description of the 3 corporation's policies and practices for promoting 4 diversity, equity, and inclusion among its board of 5 directors and executive officers. 6 Information reported under this subsection shall be 7updated in each annual report filed with the Secretary of 8State thereafter. 9 (d) Beginning no later than March 1, 2021, and every March 101 thereafter, the University of Illinois Systems shall review 11the information reported and published under subsection (c) 12and shall publish on its website a report that provides 13aggregate data on the demographic characteristics of the 14boards of directors and executive officers of corporations 15filing an annual report for the preceding year along with an 16individualized rating for each corporation. The report shall 17also identify strategies for promoting diversity and inclusion 18among boards of directors and corporate executive officers. 19 (e) The University of Illinois System shall establish a 20rating system assessing the representation of women, and 21minorities, and LGBTQ people on corporate boards of directors 22of those corporations that are publicly held domestic or 23foreign corporations with their principal executive office 24located in Illinois based on the information gathered under 25this Section. The rating system shall consider, among other 26things: compliance with the demographic reporting obligations SB1730- 6 -LRB102 14302 JLS 19654 b 1in subsection (c); the corporation's policies and practices 2for encouraging diversity in recruitment, board membership, 3and executive appointments; and the demographic diversity of 4board seats and executive positions. 5(Source: P.A. 101-589, eff. 8-27-19.) 6 Section 99. Effective date. This Act takes effect January 71, 2022.

Public Act 102-0223 SB1730 EnrolledLRB102 14302 JLS 19654 b AN ACT concerning business. Be it enacted by the People of the State of Illinois, represented in the General Assembly: Section 5. The Business Corporation Act of 1983 is amended by changing Section 8.12 as follows: (805 ILCS 5/8.12) Sec. 8.12. Female, and minority, and LGBTQ directors. (a) Findings and purpose. The General Assembly finds that women, and minorities, and LGBTQ people are still largely underrepresented nationally in positions of corporate authority, such as serving as a director on a corporation's board of directors. This low representation could be contributing to the disparity seen in wages made by females and minorities versus their white male counterparts. Increased representation of these individuals as directors on boards of directors for corporations may boost the Illinois economy, improve opportunities for women, and minorities, and LGBTQ people in the workplace, and foster an environment in Illinois where the business community is representative of our residents. Therefore, it is the intent of the General Assembly to gather more data and study this issue within the State so that effective policy changes may be implemented to eliminate this disparity. (b) As used in this Section: "Annual report" means the report submitted annually to the Secretary of State pursuant to this Act. "Female" means a person who is a citizen or lawful permanent resident of the United States and who self-identifies as a woman, without regard to the individual's designated sex at birth. "Minority person" means a person who is a citizen or lawful permanent resident of the United States and who is any of the following races or ethnicities: (1) American Indian or Alaska Native (a person having origins in any of the original peoples of North and South America, including Central America, and who maintains tribal affiliation or community attachment). (2) Asian (a person having origins in any of the original peoples of the Far East, Southeast Asia, or the Indian subcontinent, including, but not limited to, Cambodia, China, India, Japan, Korea, Malaysia, Pakistan, the Philippine Islands, Thailand, and Vietnam). (3) Black or African American (a person having origins in any of the black racial groups of Africa). Terms such as "Haitian" or "Negro" can be used in addition to "Black" or "African American". (4) Hispanic or Latino (a person of Cuban, Mexican, Puerto Rican, South or Central American, or other Spanish culture or origin, regardless of race). (5) Native Hawaiian or Other Pacific Islander (a person having origins in any of the original peoples of Hawaii, Guam, Samoa, or other Pacific Islands). (6) "Publicly held domestic or foreign corporation" means a corporation with outstanding shares listed on a major United States stock exchange. (c) Reporting to the Secretary of State. As soon as practical after the effective date of this amendatory Act of the 101st General Assembly, but no later than January 1, 2021, the following information shall be provided in a corporation's annual report submitted to the Secretary of State under this Act and made available by the Secretary of State to the public online as it is received: (1) Whether the corporation is a publicly held domestic or foreign corporation with its principal executive office located in Illinois. (2) Where the corporation is a publicly held domestic or foreign corporation with its principal executive office located in Illinois, data on specific qualifications, skills, and experience that the corporation considers for its board of directors, nominees for the board of directors, and executive officers. (3) Where the corporation is a publicly held domestic or foreign corporation with its principal executive office located in Illinois, the self-identified gender of each member of its board of directors. (4) Where the corporation is a publicly held domestic or foreign corporation with its principal executive office located in Illinois, whether each member of its board of directors self-identifies as a minority person and, if so, which race or ethnicity to which the member belongs. (5) Where the corporation is a publicly held domestic or foreign corporation with its principal executive office located in Illinois, the self-identified sexual orientation of each member of its board of directors. (6) Where the corporation is a publicly held domestic or foreign corporation with its principal executive office located in Illinois, the self-identified gender identity of each member of its board of directors. 7 (5) Where the corporation is a publicly held domestic or foreign corporation with its principal executive office located in Illinois, a description of the corporation's process for identifying and evaluating nominees for the board of directors, including whether and, if so, how demographic diversity is considered. 8 (6) Where the corporation is a publicly held domestic or foreign corporation with its principal executive office located in Illinois, a description of the corporation's process for identifying and appointing executive officers, including whether and, if so, how demographic diversity is considered. 9 (7) Where the corporation is a publicly held domestic or foreign corporation with its principal executive office located in Illinois, a description of the corporation's policies and practices for promoting diversity, equity, and inclusion among its board of directors and executive officers. Information reported under this subsection shall be updated in each annual report filed with the Secretary of State thereafter. (d) Beginning no later than March 1, 2021, and every March 1 thereafter, the University of Illinois Systems shall review the information reported and published under subsection (c) and shall publish on its website a report that provides aggregate data on the demographic characteristics of the boards of directors and executive officers of corporations filing an annual report for the preceding year along with an individualized rating for each corporation. The report shall also identify strategies for promoting diversity and inclusion among boards of directors and corporate executive officers. (e) The University of Illinois System shall establish a rating system assessing the representation of women, and minorities, and LGBTQ people on corporate boards of directors of those corporations that are publicly held domestic or foreign corporations with their principal executive office located in Illinois based on the information gathered under this Section. The rating system shall consider, among other things: compliance with the demographic reporting obligations in subsection (c); the corporation's policies and practices for encouraging diversity in recruitment, board membership, and executive appointments; and the demographic diversity of board seats and executive positions. (Source: P.A. 101-589, eff. 8-27-19.) Section 99. Effective date. This Act takes effect January 1, 2022.