Bill Text: IL HB3394 | 2019-2020 | 101st General Assembly | Introduced
NOTE: There are more recent revisions of this legislation. Read Latest Draft
Bill Title: Amends the Business Corporation Act of 1983. Provides that corporations shall report to the Secretary of State: (1) whether the corporation is a publicly held domestic or foreign corporation with its principal executive office located in Illinois; (2) 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) whether each member of the corporation's board of directors self-identifies as a minority person and, if so, which race or ethnicity to which the member belongs; and (4) other information. Requires the Secretary to State to make the information public. Requires the University of Illinois System to review the reported information and 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. Requires the establishment of a rating system assessing the representation of women and minorities on corporate boards. Provides that the report shall also identify strategies for promoting diversity and inclusion among boards of directors and corporate executive officers. Effective immediately.
Spectrum: Partisan Bill (Democrat 29-0)
Status: (Passed) 2019-08-28 - Added Co-Sponsor Rep. Nicholas K. Smith [HB3394 Detail]
Download: Illinois-2019-HB3394-Introduced.html
Bill Title: Amends the Business Corporation Act of 1983. Provides that corporations shall report to the Secretary of State: (1) whether the corporation is a publicly held domestic or foreign corporation with its principal executive office located in Illinois; (2) 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) whether each member of the corporation's board of directors self-identifies as a minority person and, if so, which race or ethnicity to which the member belongs; and (4) other information. Requires the Secretary to State to make the information public. Requires the University of Illinois System to review the reported information and 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. Requires the establishment of a rating system assessing the representation of women and minorities on corporate boards. Provides that the report shall also identify strategies for promoting diversity and inclusion among boards of directors and corporate executive officers. Effective immediately.
Spectrum: Partisan Bill (Democrat 29-0)
Status: (Passed) 2019-08-28 - Added Co-Sponsor Rep. Nicholas K. Smith [HB3394 Detail]
Download: Illinois-2019-HB3394-Introduced.html
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1 | AN ACT concerning business.
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2 | Be it enacted by the People of the State of Illinois,
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3 | represented in the General Assembly:
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4 | Section 5. The Business Corporation Act of 1983 is amended | |||||||||||||||||||
5 | by adding Section 8.10.1 as follows:
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6 | (805 ILCS 5/8.10.1 new) | |||||||||||||||||||
7 | Sec. 8.10.1. Composition of board of directors. | |||||||||||||||||||
8 | (a) No later than the close of the 2020 calendar year, a | |||||||||||||||||||
9 | publicly held domestic or foreign corporation whose principal | |||||||||||||||||||
10 | executive offices, according to the corporation's SEC 10-K | |||||||||||||||||||
11 | form, are located in Illinois shall have a minimum of one | |||||||||||||||||||
12 | female director and one African American director on its board | |||||||||||||||||||
13 | of directors. A corporation may increase the number of | |||||||||||||||||||
14 | directors on its board to comply with this Section. | |||||||||||||||||||
15 | (b) No later than July 1, 2020, the Secretary of State | |||||||||||||||||||
16 | shall publish a report on its website documenting the number of | |||||||||||||||||||
17 | domestic and foreign corporations whose principal executive | |||||||||||||||||||
18 | offices, according to the corporation's SEC 10-K form, are | |||||||||||||||||||
19 | located in Illinois and that have at least one female director | |||||||||||||||||||
20 | and one African American director. | |||||||||||||||||||
21 | (c) No later than March 1, 2021, and annually thereafter, | |||||||||||||||||||
22 | the Secretary of State shall publish a report on its Internet | |||||||||||||||||||
23 | website regarding, at a minimum, the following: |
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1 | (1) The number of corporations subject to this Section | ||||||
2 | that were in compliance with the requirements of this | ||||||
3 | Section during at least one point during the preceding | ||||||
4 | calendar year. | ||||||
5 | (2) The number of publicly held corporations that moved | ||||||
6 | their United States headquarters to Illinois from another | ||||||
7 | state or out of Illinois into another state during the | ||||||
8 | preceding calendar year. | ||||||
9 | (3) The number of publicly held corporations that were | ||||||
10 | subject to this Section during the preceding year, but are | ||||||
11 | no longer publicly traded. | ||||||
12 | (d)(1) The Secretary of State may adopt rules to implement | ||||||
13 | this Section. The Secretary of State may impose penalties for | ||||||
14 | violations of this Section as follows: | ||||||
15 | (A) For failure to timely file board member | ||||||
16 | information with the Secretary of State pursuant to a | ||||||
17 | rule adopted pursuant to this paragraph, the amount of | ||||||
18 | $100,000. | ||||||
19 | (B) For a first violation of subsection (a) or (b), | ||||||
20 | the amount of $100,000. | ||||||
21 | (C) For a second or subsequent violation of | ||||||
22 | subsection (a) or (b), the amount of $300,000. | ||||||
23 | (2) For the purposes of this subsection, each director seat | ||||||
24 | required by this Section to be held by a female or African | ||||||
25 | American director that is not held by a female or African | ||||||
26 | American during at least one point of a calendar year shall |
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1 | constitute a violation. | ||||||
2 | (3) Penalties collected pursuant to this Section shall be | ||||||
3 | available, upon appropriation by the General Assembly, for use | ||||||
4 | by the Secretary of State to offset the cost of administering | ||||||
5 | this Section. | ||||||
6 | (f) As used in this Section: | ||||||
7 | (1) "African American" means a citizen with at least | ||||||
8 | partial Sub-Saharan African ancestry and who | ||||||
9 | self-identifies as being African American. | ||||||
10 | (2) "Female" means an individual who self-identifies | ||||||
11 | her gender as a woman, without regard to the individual's | ||||||
12 | designated sex at birth. | ||||||
13 | (3) "Publicly held corporation" means a corporation | ||||||
14 | with outstanding shares listed on a major United States | ||||||
15 | stock exchange.
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