On Friday, the SEC approved Nasdaq’s proposal for new listing rules regarding board diversity and disclosure, along with a proposal to provide free access to a board recruiting service. The new listing rules adopt a “comply or explain” mandate for board diversity for most listed companies and require companies listed on Nasdaq’s U.S. exchange to publicly disclose “consistent, transparent diversity statistics” regarding the composition of their boards in a matrix format. (See this PubCo post.) Nasdaq has now posted a three-page summary of its new board diversity rule, What Nasdaq-listed Companies Should Know.

Nasdaq’s summary includes some useful resources, including the following:

There may be a significant need for those services. Bloomberg reports that over a third of companies trading on the Nasdaq lack a racially diverse director, and more than one in 10 have no female directors, according to an analysis by ISS Corporate Solutions of 2,284 companies where data were available. About 8% had neither a woman nor person of color on the board, the data showed. More than 3,000 stocks trade on the exchange, according to Nasdaq.

Posted by Cydney Posner