July 11, 2018

Do Boards Really Talk About Race?

At a recent conference, I wound up in a fascinating conversation with someone who spends a lot of time inside boardrooms. The topic was whether boards were talking about race. Talking about race at all – whether in the context of board diversity or business strategy in general. The upshot was not surprising. People are scared to talk about race – and that includes directors.

This doesn’t mean that those hesitant to talk about race are racists. It’s simply that people are uncomfortable talking about race. At least the people I know – which tends to be a whole lot of white people. Which is most of the people in our field. Our field is dominated by white people. That has changed little in the 30 years that I’ve been in it. And if we don’t talk about it, that won’t change.

If you have ideas – or have seen initiatives – to improve this situation, please email me. I’d like to see real change in my lifetime. I remember SEC Chair Levitt really pushing for diversity in the financial world in the ’90s. I’d like to help push for more diversity among corporate lawyers & governance professionals.

Why Women Rarely Serve on Dissident Slates

Our “Women’s 100” events are governed by the ‘Chatham House’ rule – but Aneliya Crawford of Schulte Roth gave me permission to share this nugget with you. During one of these events, Aneliya was interviewed on the topic of dealing with activists. She represents many of them – and she was asked about why so few women serve as director nominees for activists during a proxy fight.

Aneliya responded that she’s studied this question in depth – and has concluded that the answer isn’t that activists don’t want nor seek women. Rather, the qualified women that they approach only want to serve on the board if the proxy fight settles. In general, they otherwise don’t want to be on a dissident slate and have their name slung through the mud. I don’t blame them. I wouldn’t want that either…

Conflict Minerals: Disclosures Over Past Few Years Similar

Recently, the GAO conducted its annual conflict minerals review as required under Dodd-Frank – and here’s the report. Here’s an excerpt from this Cooley blog that summarizes the findings:

The GAO found that, generally, the disclosures filed in 2017 were similar to those filed in the prior two years. The GAO estimated that, out of 1,165 companies that filed conflict minerals disclosures, almost all companies reported in 2017 that they performed country-of-origin inquiries. As a result of those inquiries, an estimated 53% reported whether the conflict minerals in their products came from the DRC or one of the adjoining countries, up from estimated 49% in 2016 and 2015—which you could characterize as an increase that crosses a significant “majority“ threshold except that the estimates have a margin of error of plus or minus 10 percentage points at the 95-percent confidence level. The percentage is 2017 was, however, significantly higher than the estimate of 30% in 2014.

Broc Romanek