Legislation requiring public companies to report on the diversity of their corporate boards and executive officers was reintroduced Feb. 23 in the Senate and House by Sen. Bob Menendez (D-NJ), above right, and Rep. Gregory Meeks (D-NY), left, (Bloomberg Law, Feb. 23)
- The Improving Corporate Governance Through Diversity Act would amend the 1934 Securities Exchange Act to require issuers of securities that must file annual reports to disclose in proxy statements:
- Data on the racial, ethnic, and gender composition of their executive officers, board of directors, and board nominees;
- Whether any director, board nominee, or executive officer is a veteran; and
- Plans or strategies to promote diversity at the board and executive levels.
- “Without greater diversity in top corporate positions, the U.S. will fail to compete with other leading economies and stall our nation’s progress towards full inclusivity,” said Sen. Menendez. “It’s time corporate boardrooms mirror the rich diversity of our country.” (Menendez news release, Feb. 23
- “Revealing the gender, racial, ethnic and veteran makeup of these corporate C-suites and boardrooms will not only shed light on the value of diversity, but hopefully encourage corporate shareholders to increase diversity in the highest ranks of their corporations,” said Rep. Meeks. (Meeks news release, Feb. 23)
- The Improving Corporate Governance Through Diversity Act passed the House in the last Congress but did not advance in the Senate. (Roundtable Weekly, July 31, 2020). Now that the Senate is controlled by the Democrats, the measure has a higher likelihood of passage this session.
- The Roundtable supports the Menendez-Meeks bill along with other groups including Nareit, NAIOP, International Council of Shopping Centers, Real Estate Executives Council (REEC) and the U.S. Chamber of Commerce. (Meeks news release, Feb. 23)
- “Diversifying corporate leadership is a critical step to provide equal business opportunities for all Americans, and we urge Congress to pass the Improving Corporate Governance Through Diversity Act,” said Roundtable President and CEO, Jeffrey DeBoer. ”It’s been estimated that $5 trillion can be added to US GDP over the next five years if we close the systemic gaps that have prevented Blacks, Hispanics, and other under-represented groups from fully and fairly participating in our economy.”
- Reports from PwC and McKinsey & Co. find that diversity in corporate management and leadership drives profitability. The McKinsey report concludes that “companies with more diverse executives were 33% more likely to see above average profits.” (CNBC, June 12, 2020)
- The Roundtable’s Equity, Diversity and Inclusion (ED&I) Committee recently issued its mission statement to create equal opportunities for Black Americans and other minorities to prosper in the commercial real estate industry. (Roundtable Weekly, Feb. 12)
The Roundtable is also a “Founding Diversity Partner” in a national program recently launched by the Real Estate Executives Council (REEC) — the leading trade association formed to promote the interests of minority executives in the CRE industry. (Roundtable Weekly, Feb. 5)
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