About a third of annual reports filed through February included diversity disclosures, according to a recent analysis by the
Wall Street Journal. Many of these companies were sharing diversity information for the first time, spurred by both new SEC regulations on human capital management disclosures and strong investor and employee pressure to do so.
Of the companies with diversity disclosures reviewed by the WSJ, most provided gender data while almost 75% provided some kind of racial/ethnic data (either in aggregate or disaggregated). As expected, the article specifically compares diversity disclosures of peer companies within the same industry in colorful charts, showing how the companies compare in terms of gender, ethnic and in some cases veteran representation overall. Additionally, an audio clip explains why current diversity data is difficult to compare between companies, clearly setting the stage for why standardized disclosure (such as EEO-1 reports) is necessary.
The WSJ piece comes as Nasdaq submitted a
revised proposal for board diversity disclosure to the SEC, which is expected to approve the proposal despite strong opposition from the Republican contingent of the Senate Banking Committee. Nasdaq amended its proposal to be more lenient for smaller boards, newly-listed companies and companies who no longer meet goals due to a vacancy on the board. Nasdaq also confirmed it will not “verify” the accuracy of disclosures and will accept the accuracy of any director’s self-identification, and maintains that the proposal is not a quota or unavoidable delisting for companies, as the option to simply explain why diversity goals aren’t met is always available.
