The governor could soon sign a law mandating nonprofits disclose the demographic data of their board members.
The measure, according to the bill’s sponsor State Sen. Adriane Johnson, would only apply to larger nonprofits, those that provide $1 million or more in grants. Johnson said the goal is to give nonprofits an opportunity to have more diverse leadership.
“[With this bill] we will build upon the General Assembly’s previous efforts to highlight and elevate leadership, diversity, equity and inclusion in Illinois,” said Johnson. “This bill requires non profit organizations that provide $1 million in grants each year to report the demographic data on their public-facing website.”
State Sen Jil Tracy opposed Senate Bill 2930 on the floor and said this would be a burden on nonprofit organizations especially considering most board members are volunteers.
“Our nonprofits organizations in Illinois do great work and are needed,” said Tracy. “Putting a burden on them … that makes it more difficult for them to get volunteer board members … I think it is a bad idea.”
The measure also invites nonprofits to go beyond publishing the data on their websites and to report the data on their annual report. Individual board members can decline the disclosure of their demographic data to their nonprofit organization. The nonprofit has to report that individual as a “declines to disclose” board member as opposed to White, Black, Asian, etc.
In 2019, Gov. J.B. Pritzker signed a law that requires private companies with a principal executive office located in Illinois to provide the gender, racial and ethnic diversity of its board members.
Tracy said nonprofits are in a unique position, comparatively, to corporations that have been required to report diversity data since 2019 because people employed by nonprofits have to be there because they believe in a certain mission.
“Certainly we want diversity but it’s a unique situation for a nonprofit organization in choosing who to ask to be on their board because of their certain mission,” said Tracy. “Many of these are run by volunteers…does it make sense that they’re going to have to hire staff to report the [demographic] disclosures?”
Republicans argued the mandate will be costly to nonprofit organizations because of the work needed to comply with the data disclosure requirements. Johnson said the Department of Human Rights will develop and publish a standardized list of demographic guidelines to use when reporting.
“It is critically important we consider leadership diversity and this gives organizations an opportunity to consider others for leadership,” said Johnson. “This is not an invasion of privacy because individuals can decline [to disclose their demographic information].”
When Pritzker signed the corporate leadership diversity law in 2019, he said better diversity among leadership leads to reduced turnover, increased growth and improved market share.
