Nasdaq plans to require more diversity on listed company boards

Under the proposed rules, most companies on the U.S. exchange would have to have one woman director and one who is minority or LGBTQ

Nasdaq Inc. asked the Securities and Exchange Commission for clearance to require more diversity on companies’ boards of directors.

Under the proposed rules, most companies listed on Nasdaq’s U.S. exchange would have to include at least one director who identifies as female and one who identifies as an underrepresented minority or LGBTQ, Nasdaq said in a statement Tuesday.

“Nasdaq’s purpose is to champion inclusive growth and prosperity to power stronger economies,” Nasdaq Chief Executive Adena Friedman said in the statement. “We believe this listing rule is one step in a broader journey to achieve inclusive representation across corporate America.”

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Companies are under increasing pressure from investors and advocates to improve diversity in their top ranks and be more transparent about the makeup of their workforces. In a recent survey, 25 of the biggest companies in the U.S. were willing to make public a copy of the form as it’s presented to the Equal Employment Opportunity Commission.

The proposed rule would also require all Nasdaq-listed companies to disclose diversity statistics regarding their directors. Foreign companies could satisfy the requirement by including two female directors.

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