Number of the Day
Nasdaq’s Hollow Board Diversity Mandate, by the Numbers
The stock exchange puts some very gentle pressure on companies to diversify their corporate boards
75%: That’s roughly the share of the 3,249 companies listed on Nasdaq that the stock exchange says fails to meet its newly proposed board diversity requirements, the New York Times reported.
Nasdaq asked the Securities and Exchanges Commission on Tuesday to approve a new rule requiring companies listed on its stock exchange to have at least one woman and one member of an underrepresented minority group on their corporate board of directors, saying it wants to champion inclusive growth. But while its proposal sends a message about the importance of diversity in corporate leadership, the exchange won’t be too strict about enforcing it: Even though Nasdaq found that more than three-quarters of companies on its exchange don’t currently meet this low bar, companies have up to four years to diversify their boards. Even those that don’t are unlikely to be delisted — a company can simply choose not to comply with these requirements if it provides a written explanation.
