By Ross Kerber and Jessica DiNapoli
(Reuters) – Top asset manager BlackRock Inc on Tuesday said it wants U.S. companies to aim for a board that is 30% diverse and, for the first time, contain at least one member from an under-represented group.
In new guidelines explaining its priorities for 2022 at portfolio companies, the $9.5 trillion asset manager also gave companies more leeway on how they report on their impact on climate change and said companies should hold votes on reorganization proposals.
Together, the updates showed the influential New York-based firm taking steps similar to other big asset managers pressing portfolio companies on environmental, social and governance considerations.
Earlier this month Goldman Sachs Group Inc said it wants big companies to have at least one director from an under-represented group, citing the growing availability of corporate disclosures showing personal diversity data.
Boards have been bolstering their diversity by adding new members in recent years, in line with growing attention to the subject from investors, employees and customers.
Among S&P 500 companies, 21% of directors are either Black, Asian or Hispanic, according to executive recruiting firm Spencer Stuart. Among 234 mid-cap companies that disclose diversity statistics, 18% of directors were from historically under-represented groups, according to Spencer Stuart.
Women now make up 30% of all S&P 500 directors. Among mid-cap companies, the figure is 28%, according to Spencer Stuart.
Last year BlackRock cited the limited amount of data as a reason for not setting a racial or ethnic diversity target in boardrooms, and had asked companies to disclose more details.
According to language sent by a BlackRock representative, directors from under-represented groups can include racial or ethnic minorities, people who identify as LGBTQ+, people with disabilities and veterans.
BlackRock’s guidelines did not specify exactly when it would vote against directors that did not meet its new standards, but a lack of diversity was a major reason the firm voted against more directors in 2021 than in prior years.
MORE REPORTING ACCEPTED
On climate matters, BlackRock previously had pressed companies to report their emissions and other factors under the SASB standards of the Value Reporting Foundation. In its new guidelines, BlackRock said companies may use other standards, noting the work of a new international board announced at the United Nations climate summit in Scotland last month.
On corporate structures, BlackRock said companies looking to convert to new forms should put the issue to a shareholder vote. Some companies are shifting to structures like “public benefit corporations” to take account of the interests of employees and other stakeholders, a move backed by a growing number of advocates.
(Reporting by Ross Kerber in Boston and Jessica DiNapoli in New York; Additional reporting by Simon Jessop in London; Editing by Dan Grebler)
