The San Diego biotech industry stands to be particularly affected by a recently signed bill requiring California public companies to have at least one woman on their board by the end of 2019.

Research points to life sciences — a key driver of the county’s economy — fueling a gender imbalance among directors of public companies. Observers say San Diego’s life sciences ecosystem is shaped by investors, who are largely male and recruit via personal networks less likely to include females.

“Smaller boards in general are more likely to have all-male boards or a fewer number of female directors per board," said Annalisa Barrett, a clinical professor of finance at the University of San Diego's School of Business, who has conducted research on corporate boards.

In 2016, 13 of the 25 largest biotechs in San Diego — or 52 percent — didn’t have a female board member, according to data Barrett compiled from the Russell 3000 stock index of large firms. That was 10 percent higher than the county’s industrywide total.

Greater Imbalance at Small Firms?

Barrett said it appears that the percent of all-male boards is even greater if taking into account smaller public biotechs, which she plans to capture with hard numbers in future research.

The imbalance appears related to the high percentage of startups in San Diego biotech. Venture capitalists — usually male — supporting them have a large say over board makeup.

Barrett said life science investors don’t seem as concerned about the issue as firms like BlackRock. One of the largest shareholders of American companies, BlackRock has urged portfolio companies to have at least two women directors.

Beyond the 2019 California deadline, the new law mandates a public company with five directors have at least two female board members by 2021, and a board with six or more directors must include at least three women.

Fines for Violations

Companies that fail to meet the mandate face fines of $100,000 for a first violation and $300,000 for breaking the rules a second or subsequent time.

Two local biotechs with all-male boards — AnaptysBio and Medicinova — did not return a request to comment on compliance plans.

Most biotechs rely on their networks when searching for board members but that is bound to change with the new law. So said Robin Toft, founder, president and CEO of Toft Group, a San Diego-based firm that specializes in life sciences and health care recruitment.