Congressional Democrats want publicly traded companies to divulge more demographic information about their boards and senior ranks.
A bill reintroduced Tuesday by New Jersey Senator Bob Menendez aims to boost Securities and Exchange Commission disclosure rules by extending reporting requirements on race, ethnicity, gender and veteran-status of directors and senior leadership. The push comes after Nasdaq Inc. proposed requiring more diversity on company boards.
Menendez says the bill — which has a companion in the House and is also backed by Senate Banking Committee Chairman Sherrod Brown and Massachusetts Senator Elizabeth Warren — would help bridge the gap between companies’ statements in support of diversity and tangible progress. “It’s time corporate boardrooms mirror the rich diversity of our country,” Menendez, the highest-ranking Latino in Congress, said in a statement.
Similar legislation was passed by the Democratically-controlled House in November 2019 but was never considered by the Senate, where the current proposal faces challenging prospects in the closely-divided chamber. Republicans are already pushing back against Nasdaq’s plan.
The U.S. business community is largely on board with Menendez’s measure, with the U.S. Chamber of Commerce, the Financial Services Forum and Real Estate Roundtable among its supporters.
The bill “will establish a model to organically boost diversity on boards through disclosure, rather than the counterproductive quota-driven strategies that some have attempted,” Tom Quaadman, executive vice president for the Chamber’s Center for Capital Markets Competitiveness, said in the statement released by Menendez’s office.
By Caitlin Webber