What Nasdaq’s diversity rule tells us about the direction of disclosure in the US

ESG Insider: A podcast from S&P Global

In early August, the U.S. Securities and Exchange Commission approved a proposal by Nasdaq to require companies listed on the New York-based exchange to disclose certain board diversity information. In this episode of ESG Insider, we explore what the rule means in practice for companies and investors.

We hear from Matt Patsky, the CEO of Trillium Asset Management, about why investors view board diversity as a material factor — and what the SEC approval indicates about the direction of disclosure in the U.S.

“The SEC's willingness to approve this Nasdaq board diversity rule sends a strong signal that they believe there's materiality to diversity,” Matt says. “And with that belief, I think it means we're moving closer to the SEC mandating disclosure of diversity information from companies broadly.”

For the corporate and regulatory perspective, we talk with Cam Hoang, a corporate securities and SEC compliance lawyer and partner at the law firm Dorsey & Whitney. We also hear the recruiter’s perspective on the new rule from WSS Executive Search CEO & Founder Becky Heidesch, who has been helping companies find candidates with diverse profiles for decades.

In the episode, you’ll hear us refer to an S&P Global Market Intelligence analysis of gender diversity on U.S. company boards and executive teams. You can read that research here:

https://platform.mi.spglobal.com/web/client?auth=inherit#news/article?id=65743394&cdid=A-65743394-9776

To learn more about human capital management disclosures in the U.S., listen to this earlier episode of ESG Insider:

https://traffic.libsyn.com/secure/esginsider/ESG_Insider_US_Diversity_Regulations_-_v3.mp3

Photo credit: Getty Images