The Conference Board Middle East and North Africa Briefs

California's new corporate board quota law marks the first time a U.S. state will mandate gender diversity. It will put pressure on companies to be more diverse. While it will most likely be challenged in court, companies potentially affected could begin managing internal targets for naming female directors and disclosing to stakeholders who can assess whether their intentions match their outcomes.

By pledging to increase Wells Fargo’s 2019 charitable contributions to 2 percent of after-tax profits, CEO Tim Sloan has set a high bar for community giving. In 2018, the company upped its giving to $400 million, a 40 percent increase over 2017, spurred somewhat by the announced tax reform. Wells Fargo is still an outlier: the top 25 percent of companies contribute a median of $55.3 million, according to Giving in Numbers, published by CECP in association with The Conference Board.

Even if the new gender diversity law is successfully challenged, the fact of it having been enacted by the State of California sends a strong signal. It is an important consideration for boards to incorporate in their board composition deliberations.

More than 70 percent of Americans believe the arts unify our communities regardless of age, race, and ethnicity and that the arts help them understand other cultures better, indicating the importance of the sector to individuals and the companies that employ them. Overwhelmingly, people also believe that the arts are a part of a well-rounded education. Companies looking to create meaningful social impact for their communities need to be working with the arts in a variety of ways.

President Trump’s proposal to change financial reporting to every six months from quarterly and Sen. Elizabeth Warren’s American Capitalism Act are two examples of how Washington puts forth “slapdash” efforts instead of wholistic ones to address governance issues.

Continued uncertainty over the outcome of Brexit negotiations is not helping. Unemployment in the UK now stands at its lowest level in four decades. Gross domestic product growth at the start of the third quarter of 2018 also shows an economy in decent shape, having grown faster than in the prior two quarters.

Nearly half of Americans believe CEOs can influence the government, although that doesn't necessarily mean the country thinks CEOs should speak out about social issues. Americans are split on whether company leaders should try to use their influence in the public domain, but doing so could benefit the business, since nearly half of the country would be more likely to purchase from a company whose CEO has taken a stance on an issue that they agree with.

With, among other things, the embrace of corporate purpose, ESG, and long-term investment strategy by BlackRock, State Street and Vanguard; the adoption and promotion by the World Economic Forum of The New Paradigm; and the introduction of legislation by Senator Warren to achieve stakeholder corporate governance by way of mandatory federal incorporation, it is clear that we are at a new inflection point in the development of corporate governance.

Build your community disaster-response strategy around your company’s core competencies. Your company has already developed strengths and knowledge in a specific area. Support a disaster-response strategy that aligns with that expertise to potentially save lives or lighten the burden of a disaster. Case in point: Airbnb is offering free lodging to people fleeing Hurricane Florence in the Carolinas.