Nasdaq's New Diversity Proposal Could Cause DFW Companies to Rethink Board Make-Up

Some North Texas companies listed on the Nasdaq may have some explaining to do if a new proposal by the exchange operator is approved.

Nasdaq filed a proposal with the Securities and Exchange commission Tuesday aimed at diversifying boards of directors. It would require companies to have at least one woman director, in addition to one person of color or self-identified member of the LGBTQ community on the board. The new rule would also require companies to disclose information about their board of directors’ diversity in race, gender and other factors.

Companies that do not meet the diversity requirements would have to explain why.

Out of the top 40 local companies listed on the Nasdaq, the Dallas Business Journal found information on the make-up of the boards for 26. A little under half those companies would not be able to meet this new criterion.

Eight of the 26 companies analyzed did not have a woman on the board. It’s important to have women, especially women of color, in the boardroom because they can provide a different perspective, said Tracey Doi. Doi is the chief financial officer for Toyota Motor North America and a national board member of nonprofit 2020 Women on Boards.

“I think it's important that nomination and governance committee chairs on boards recognize that it's important to expand the pool of candidates that they're looking at to help address these really serious issues that our nation is facing,” Doi said.

2020 Women on Boards works in advocacy and education to achieve gender parity on boards around the country. Doi, along with local co-chairs Arcilia Acosta and Thear Suzuki, hosted a virtual event in mid-November on how women on boards are helping companies in this time of crisis. The event was also aimed at expanding the network of those in North Texas who currently serve on boards.

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