Argyle's "Language Used to Describe Director Ethnicity in S&P 100 Proxy Statements" benchmarks S&P 100 proxy statement board racial/ethnic diversity disclosure and provides examples with links to the relevant sources.
Key benchmarking data takeaways relating to the nearly 80% of companies (79 companies) that disclosed board ethnic/racial diversity include:
- Three companies disclosed board ethnic/racial diversity by specifically identifying ethnicities/races and by using other terms such as “people of color,” “minorities,” “underrepresented ethnic groups,” “born outside of the U.S.,” “non-U.S. citizen” or “citizen of another country.”
- 20% disclosed board diversity by specifically identifying ethnicities/races (e.g., Asian, Black/African American, Hispanic/Latino, Native Hawaiian/Pacific Islander, American Indian/Alaskan Native/Native American, and White/Caucasian).
- 25% used other terms such as “people of color,” “minorities,” “underrepresented ethnic groups,” “born outside of the U.S.,” “non-U.S. citizen” or “citizen of another country” to disclose their board ethnic/racial diversity.
- 51% generally disclosed their board ethnic/racial diversity by using the terms “diverse,” “ethnically diverse” or similar.
As we previously reported, effective for meetings on or after February 1, 2022, ISS will recommend voting against the chair of the nominating committee (or other relevant directors on a case-by-case basis) at Russell 3000 and S&P 1500 companies where the board has no apparent racially or ethnically diverse directors. Mitigating factors - including the presence of a racial and/or ethnic minority on the board at the preceding annual meeting and a firm commitment to appoint at least one racial and/or ethnic diverse member - will be considered. In the interim, ISS will identify in its research reports boards that lack racial and/or ethnic diversity to foster investor/company engagement on this topic.
This post first appeared in the weekly Society Alert!