REMINDER: Female and Minority Directors Report Now Required for Illinois-Headquartered Public Companies; Results to be Published by Illinois Secretary of State
July 1, 2020
As we reported last August, Illinois has adopted a requirement that all public companies incorporated or qualified in Illinois with their principal executive office located in Illinois must now report, along with their Illinois Annual Report, information about the gender and minority status of their directors and officers.
Illinois has now adopted the form (Form BCA 8.12) that must be completed and filed with the Annual Report. To access the form, please click here. The Form BCA 8.12 is due with the Illinois Annual Report which in turn is due on the anniversary of the date that a corporation first filed either its articles of incorporation or, if a foreign corporation headquartered in Illinois, its qualification as a Foreign Corporation. It should be noted that only corporations that have an Illinois Annual Report filing obligation potentially have to file the Form BCA 8.12. For example, if a public reporting holding corporation has a principal executive office in Illinois but is not qualified to do business in Illinois, it has no Illinois Annual Report filing obligation. Furthermore, any subsidiary of such corporation that is qualified in Illinois would not be required to file the Form BCA 8.12 as part of its Illinois Annual Report as it is not itself a publicly held corporation. This example shows the unexpected result where a publicly held holding corporation with its principal offices located in Illinois would not be required to file the Form BCA 8.12.
Form BCA 8.12 requires disclosure of:
- data on qualification, skills and experience that the corporation considers for directors and executive officers;
- self-identified gender of each board member;
- race or ethnicity of each board member;
- description of the corporation’s process for identifying and evaluating and appointing board members and officers, including whether and how demographic diversity is considered;
- a description of policies and practices for promoting diversity, equity and inclusion among directors and executive officers.
Further, the Illinois Secretary of State is publishing the results of the filings, so a corporation’s responses will be readily available to the public. The findings can be found here.
There are obviously several different approaches that can be taken to submitting responses, but corporations subject to the new disclosures should consider updating their Nominating Committee Charters in advance of the required filing to incorporate any changes in nominating criteria and process which can then be included in the Form BCA 8.12. Companies should also be mindful that this information may be used by groups to highlight a company’s lack of diversity in its director and officer ranks.
* * *
For more information, contact:
About Croke Fairchild Morgan & Beres
Croke Fairchild Morgan & Beres is a corporate law firm providing services to businesses, private equity and venture firms and their portfolio companies, public companies, founders and family offices. Formed by partners who worked at preeminent international law firms, the firm boasts a deep bench of sophisticated and experienced corporate lawyers. With offices in Chicago, Lake Forest, and Milwaukee, our team provides exceptional legal service while affording our clients the benefits of working with a small, agile, and driven law firm. For more information, please visit us online at crokefairchild.com