Comptroller Stringer: New York City’s Diversity, Equity, and Inclusion Initiatives Should Serve as a National Model

(New York, NY) – Today, New York City Comptroller Scott M. Stringer sent a letter to U.S. President Joseph R. Biden, Jr. outlining federal recommendations for advancing diversity, equity, and inclusion nationwide based on successful Comptroller initiatives in New York City–including increasing access to federal institutional capital for diverse managers, implementing a “Rooney Rule” for federal hiring, requiring diversity disclosure from public companies, and addressing barriers to government procurement and contracting.

Comptroller Stringer urged cooperation of government at all levels to address institutionalized biases and racial inequity in light of President Biden signing Executive Order 13985, Advancing Racial Equity and Support for Underserved Communities Through the Federal Government, on January 20, 2021.

“Diversity, equity, and inclusion are critical for the future growth and sustainability of our country’s economy and while we have made strides in New York City, we cannot fully achieve these goals without buy-in from all levels of government,” said Comptroller Stringer. “That’s why I urge President Biden and his Administration to look to the significant progress we’ve led and replicate our successful initiatives at a national scale. It will take all of us working together and sharing ideas to acknowledge, address, and correct institutionalized biases in our hiring, in our boardrooms, and in our economy.

Comptroller Stringer outlined the following recommendations:

Increase Access by Diverse Managers to Federal Institutional Capital

Strengthening executive leadership commitment as well as organizational accountability to diversity at federal investment funds, such as retirement plans, endowments and insurance programs administered or overseen by federal entities, can improve opportunity as well as investment performance. The New York City Retirement Systems have increased allocations to top-performing diverse managers by 88% since 2014 and expanded our programmatic reach to early stage and emerging managers as well as established diverse managers. Federal Investment Funds should seek to increase their utilization of top-performing diverse managers and require information about diversity in their diligence and monitoring of managers.

Implement a “Rooney Rule” for Federal Hiring

To attract the talent our nation needs, the Administration should implement a version of the “Rooney Rule” appropriate for federal hiring. Over the past year, in response to the Office of the Comptroller’s Boardroom Accountability Project 3.0, more than thirty large, public portfolio companies have adopted and disclosed a version of the Rooney Rule requiring consideration of qualified women and people of color when selecting new directors and, unprecedented at the time –  for CEOs. During 2021, the Comptroller’s office has negotiated similar policies governing the hiring of all senior executives with additional portfolio companies.

Require Diversity and Equity Disclosures from the Boardroom to the Shop Floor at U.S. Public Companies

The Administration should urge the SEC to expeditiously approve and extend to all public companies the NASDAQ proposal that would require companies listed on the NASDAQ stock exchange to disclose standardized diversity statistics regarding their board of directors and require companies to have, or explain why they do not have, at least two self-identified diverse directors.

To increase transparency and strengthen accountability beyond the boardroom, the SEC should also mandate that all public companies disclose their EEO-1 report, which they annually submit to the federal government.

In July 2020, Comptroller Stringer and three New York City Retirement Systems launched a successful national campaign asking companies to match their public statements in support of racial equity, diversity, and inclusion with concrete action by publicly disclosing their EEO-1 demographic data by race and gender. In response to the initiative, a substantial majority of S&P 100 companies are now committed to disclosing their EEO-1 report. Full, public disclosure will provide investors and other stakeholders standardized, quantitative, relevant and comparable employment data across companies and industries, which will allow investors to assess the representation and progress of employees of color and women at various levels of the corporation.

Address Barriers to Government Procurement and Contracting at the State and Local Level

The Administration should use its executive power, where possible, to address the systemic biases that M/WBEs face, not only at the federal level, but also within states and municipalities across the nation.

In 2016, the U.S Minority Business Development Agency (MBDA), which reviewed 100 state and local disparity studies from across the country, highlighted that lack of enforcement and accountability are common issues plaguing programs designed for minority- and women-owned businesses (M/WBEs). This is especially true in New York City, where Comptroller Stringer has reported that M/WBEs still only receive five percent of contract dollars.

Comptroller Stringer’s full letter to President Biden is available here.

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