SEC calls for participation in diversity self-assessment

The Securities and Exchange Commission on June 5 called on regulated entities, such as money managers and investment advisers, to voluntarily participate in its biennial diversity self-assessment.

“The participation of regulated entities in submitting diversity self-assessments is critical for a more comprehensive understanding of the diversity practices and policies that are being implemented as well as to share information on practices and identify opportunities,” said Nathaniel H. Benjamin, director of the SEC’s Office of Minority and Women Inclusion, in a June 5 news release.

The SEC has asked certain entities to submit such data every two years since 2018, though response rates have never reached 10%. The 2022 Diversity Assessment Report garnered a response rate of 6.8%, compared with 9% in 2020, and 5% in 2018.

Specifically, the SEC identified 1,327 firms, each with more than 100 employees, as potential participants in the 2022 survey, though the agency received only 58 responses, representing more than 90 entities, according to a summary of the 2022 report.

“For a more comprehensive understanding of practices and policies for workforce and supplier diversity in the financial securities industry, greater participation in the Diversity Assessment Report process is needed,” the SEC wrote in the report summary.

Of the firms that did respond in 2022, 100% said they include diversity and inclusion considerations as part of their strategic plan for recruiting, hiring, retaining and promoting employees, according to the report.

In addition, 88% of respondents said they had a written diversity and inclusion policy that is approved and supported by their CEO or another senior-level official, and 83% said they provide regular progress reports on diversity and inclusion efforts to their board of directors or other governing body.

Firms that wish to participate in the 2024 self-assessment can do so by using the SEC’s Diversity Self-Assessment Tool or submitting self-assessments in the format of their choice, according to the news release.