LGBTQ+ people only represent 0.6 percent of all corporate board members in Fortune 500 companies in 2022 (see our tracker here), an increase of only 0.1% over the past 5 years.

Until this year, LGBTQ+ people were the only underrepresented group in the Boardroom without an organization to prepare, network, and position high-caliber diverse LGBTQ+ talent from a variety of industries and professions for corporate board service in the US.

Created in June 2022, the Association of LGBTQ+ Corporate Directors is remedying this issue by promoting a culture of inclusion for LGBTQ+ people in America. By collaborating with U.S. companies, recruiters and intermediaries, we create new opportunities for LGBTQ+ top-tier existing and aspiring candidates and make corporate boards more representative of today’s America. The Association is led by a Board of 10 members who are among the most prominent LGBTQ+ people in the Governance world.

Our efforts have focused on three key areas:

• fostering relationships among LGBTQ+ people in the Governance world;
• working with companies, recruiters, and other partners to elevate LGBTQ+ profile;
• providing coaching and helping our candidates map out the journey to the boardroom.

Fostering relationships

With more than 300 members, the Association is already the largest repository of LGBTQ+ candidates in the country. In the second half of 2022, aspiring and existing Board members met each other in dinners we hosted on the East Coast such as New York (September), DC (October) and Philadelphia (November). Similar dinners are scheduled for New York (January focusing on LGBTQ+ people of color in the Boardroom), LA (February), Miami (April). Our members also interact on the Association’s virtual platform. Outside of the Association, we have encouraged members to take a more active role in the National Association of Corporate Directors with which we strengthened our relationship in 2022 by playing an active role in the Annual Summit, joining the DEI Awards Jury, continuing to participate in the NACD Center for Inclusive Governance and collaborating with the NACD Northern California Chapter’s LGBTQ+ Directors cohort. Similarly, we designed a guide on inclusive language in Minutes for the Society for Corporate Governance.

Working with intermediaries and recruiters

During the past six months, the Association worked with intermediaries such as J.P. Morgan Advisory Services or the New York Stock Exchange Board Diversity Initiative to highlight LGBTQ+ profiles. Twelve of our members have already joined the NYSE program. We also shared our initiative on the NASDAQ blog. We provided our open-source database of candidates to most recruiters in the industry and already contributed to five specific Board searches.

Coaching and mapping our members’ Board journey

The Association onboarded hundreds of LGBTQ+ aspiring and existing Board members in 2022, focusing on an individual approach. This week, we are hosting our second webinar on the theme of “landing a first board seat”. We also developed a guide on the same topic earlier this year. The previous webinar focused on the role of accreditation. We keep in touch with our membership through a weekly newsletter covering the Boardroom as well as topics at the intersection of business and LGBTQ+ news.

Outside of these key areas, the Association continued to focus on growing the demand by approaching private equity and other institutional shareholders, working with our research partner Equilar on bringing greater transparency on LGBTQ+ Board representation and building corporate partnerships.

On the international side, the Association supported the creation of the Canadian Association of LGBTQ+ Corporate Directors which has its own Advisory Board (on which Fabrice serves). Similar chapters are at various stages of development in the UK, Australia, Colombia, India, Singapore, and Hong Kong. Fabrice gave remarks on LGBTQ+ Board Diversity at the Annual Women’s Forum in Paris in November 2022 and the London Climate Summit.

Our team is encouraged by the rapid growth of the Association and its reception in the community and the governance world, clearly highlighting that the Association fills an important gap.

In 2023, we plan to keep the focus on our three key areas while hopefully building more direct links with US companies to enroll them in this effort. We will also reach out to the mainstream media, specialized magazines, and publications focusing on boardrooms in order to ensure the Association and its members are on every Board’s radar screen. We will also secure additional corporate partners to join our founding sponsor J.P. Morgan.

Wishing you great holidays.

My name is Fabrice Houdart and I am the Executive Director of the newly created Association of LGBTQ+ Corporate Directors. I am asking our Advisory Board members present today to please stand up: Richard Socarides, Betsy Bernard of course, Chiqui Cartagena, Ozzie Gromada-Mesa and Gerry Rodriguez. Four could unfortunately not join us this evening including the legendary Imara Jones, Michael Camunez, Heather Hiles, Elizabeth Mora and Denice Torres. Let me also acknowledge our COO Stephen Smith, who made this evening possible.

Since the Association was launched two months ago, I have had many conversations with Board candidates, existing directors, C-suite leaders and professionals in the governance space about the reasons behind our initiative. Almost invariably the response has been: “this is important” followed by “I can’t believe such an initiative does not exist yet”. I take it as clear sign that time has come to improve our numbers in the boardroom.

Most of you know that I spent my career in public service and the Corporate Governance space is somewhat new to me. But the reason I am passionate about it and wanted this Association to become reality, is that it shares a commonality with the challenge of LGBTQ+ inclusion in international development or the Human Rights agenda. They are all niche topics and an uphill battles.

A niche topic because the LGBTQ+ workplace inclusion efforts have focused on rank and file employees, sometimes Senior Management, rarely the C-suite, often forgetting the boardroom. In fact, LGBTQ+ Board Diversity is a fairly new topic almost completely limited to the US context with some movement in Canada and Australia.

An uphill battle because LGBTQ+ people are the least represented compared to any other group. Only 0.6% of the Fortune 500 company board seats are held by our LGBTQ+ people, despite estimates that we represent 5 to 7% of the US population.

We are being left behind. Since I started working on this topic three years ago, we only gained 0.1 points in the Fortune 500 going from 0.5 to 0.6% of the seats. LGBTQ+ people often remain invisible in the boardroom for two main reasons: Boards are not asking for LGBTQ+ candidates, and too often we are not supporting each other. Those in the boardroom need to become advocate for true inclusion at the table.

A month ago, the NASDAQ listing rule became effective. The Board Diversity Matrices that companies have now published on their websites and proxies confirmed what many of us have known for some time. Our research partner present tonight, Equilar, is now compiling this data. The abysmal statistics regarding the lack of diversity in Corporate America are worse outside of Fortune 500.

Even though there are more LGBTQ+ qualified diverse candidates for corporate board seats than ever before, almost none of these candidates are on the radar screen of nominating and governance committees. Even though our nation has grown to value LGBTQ+ contributions, the corporate boardroom is proving resistant to change mostly because our efforts have focused more on advocacy than placement.

As Betsy alluded to, it is not that LGBTQ+ people are less skilled, competent or ambitious, it is that they live at the margin of the Board ecosystem but also that Boards have to develop trust and comfort with our candidates.

I am convinced that the solution is to focus on providing resources to the ample LGBTQ+ talent pipeline. Resources include access to a powerful network, the ability to be part of the pipeline and amplifying of LGBTQ+ backgrounds. Being part of the Association is a commitment to advance this mission. We will also have a particular focus on ensuring women and LGBTQ+ people of color are benefiting from our efforts because we are part of a broader Board diversity agenda intersectional by nature. Tonight, there is only a third of participants that are women, the Association targets complete parity.

Concretely, it will mean for the Association to build relationships with the chairs of nominating and governance committees, with existing board members and with the governance community at-large. It will also mean for us to provide individual and quality services to our members but also to newly appointed and existing Board members.

Board diversity is a team sport and the fact that so many of you took the time to gather here this evening bodes well for the future. I see in this room many key partners: NASDAQ, KPMG, McKinsey, Stuart Spencer or NACD … The reason we are gathering everyone is to say, we need your help and we need to do this together.

The corporate boardroom is not a place where change typically happens swiftly and we will need both patience and determination but it is worth it. I am excited to embark on this journey with you and I thank you for your support.

Oral arguments in AFFBR vs. SEC are taking place tomorrow morning but who really is the plaintiff?

On August 9, 2021, Alliance for Fair Board Recruitment, AFFBR, filed a Petition for Review in the United States Court of Appeals for the Fifth Circuit seeking a review of the approval by the Securities and Exchange Commission (SEC) of the corporate board diversity quotas proposed by the Nasdaq stock exchange. This is one case against Board diversity efforts among several others (see my previous post on legal challenges to date). The oral arguments for Alliance for Fair Board Recruitment v. SEC are taking place in the United States Court of Appeals for the Fifth Circuit this Monday at 9 a.m. (case 21–60626 — see link). AFFBR is represented by Boyden Gray & Associates, a law and strategy firm in Washington, D.C., focused on constitutional and regulatory issues founded by a former Bush White House General Counsel.

Who really is AFFBR? And what are his motives?

On paper, AFFBR, is a Texas-based nonprofit with anonymous members who claim to be aspiring directors or shareholders of companies subject to the now repealed SB 826 and AB 979 as well as the NASDAQ listing rule. You can read the opening brief here.

In reality, AFBBR is Edward Jay Blum, most famously as the executive director of Students for Fair Admission (SFFA) and Project on Fair Representation, which spearheaded an effort to end affirmative-action admissions policies at Harvard University. Blum self-describes as a “politically conservative legal strategist known for his activism against affirmative action based on race and ethnicity”. His deep-pocketed donors included conservative groups according to IRS filings. The National Center for Public Policy Research, a conservative think-tank whose President has claimed that global warming is a religion, is a co-petitioner in the case.

Blum’s expressed motive to push back on diversity efforts is a belief in the false narrative of American meritocracy. In “An Inconvenient Minority: The Attack on Asian American Excellence and the Fight for Meritocracy” Blum is quoted as saying : “well that’s sign that other races need to step up and do better … I believe competition makes you stronger”. But we can also assume that Blum fears that competent white men might be ‘disfavored’ to make room for diverse students or Board members.

Proponents of the new listing rule argue that Boards, not unlike Ivy League Schools, have had historically a recruitment process which is much more “cliquish” than meritocratic or competitive. Leveling the playing field is necessary to ensure fairness and a true meritocracy. You can read here the Amicus Brief submitted by the ACLU.

And beyond this argument, a diverse board yield multiple benefits, including better decision-making to inform key governance issues, being at the forefront of the environmental, social and governance (ESG) agenda, more equitable representation of shareholder and stakeholder needs, better alignment with the company’s employee, customer and supplier base, and dynamic skills, backgrounds and perspectives to anticipate and respond to changing market and consumer trends.

Despite Blum’s claim that it is discriminatory and therefore unconstitutional, the NASDAQ rule is introducing fairness in Board recruitment but also good governance (see also LGBTQ+ Inclusion in the Boardroom Is Simply Good Governance).