WASHINGTON – A group of Senate Republicans have rejected Nasdaq’s push for greater diversity on corporate boards, saying it interferes with board members’ duty to govern in the best interests of shareholders and could hurt financial performance .
In a letter Friday, all 12 Republicans in the Senate Banking Committee called on the Securities and Exchange Commission to reject Nasdaq’s proposal to reject some of the thousands of companies listed on its stock exchange for women, racial minorities and LGBT individuals to include in their boards.
“We commend individual businesses for the proactive efforts they have already made to recruit, promote and maintain diverse talent,” the senator, led by Pat Toomey, of Pennsylvania, wrote. “However, that is not the role of Nasdaq … to act as an arbitrator of social policy or to enforce a prescribed solution for all markets and investors.”
Nasdaq’s proposal, submitted to the SEC in December, requires listed companies to have at least one woman on their boards, in addition to a director who is a racial minority or one who describes himself as lesbian, gay, bisexual, transgender or queer. Identify. . Companies that do not meet the standard must justify their decision to stay listed on Nasdaq.
Nasdaq said in a statement on Friday that its proposal “is a market-driven solution that should simplify and standardize disclosure requirements to avoid the type of regulatory breach that critics fear.”