Corporate Governance

The SEC and Diversity in the Boardroom (Not to Mention the SEC) (Part 6)

By J Robert Brown Jr.

Commissioner Aguilar did not limit his remarks to the corporate boardroom.  He likewise noted the need for greater diversity in the federal government.   

• The federal government, for example, could do better. Although, according to the Annual Equal Employment Opportunity Commission Report on the Federal Workforce, people of color represented a third of the Federal work force in fiscal year 2009- approximately on par with current U.S. demographics- Latinos and women remain underrepresented.

The federal government, as it turns out, includes the SEC.  The five person Commission is itself diverse, particularly with women in the majority.  As Commissioner Aguilar noted, however, there is a dearth of diversity among the professional staff. 

• While 32 percent of the SEC work force comprised people of color in 2007, only 19% of our attorneys were people of color, and just 7 percent were at senior employee level. The most telling numbers are of our senior officers. As of fiscal year 2009, the SEC's senior officers were approximately 89% white, 4% African-American, 3% Hispanic and 2% Asian. The gender breakdown among these officers is 67% male and 33% female.

The numbers in the legal profession are likewise bad, something that has only gotten worse during the recent economic downturn, again a problem not limited to the United States.

The answer, as Commissioner Aguilar notes, is to recruit.  The candidates are out there.   Most law schools have somewhere around 20% people of color and plenty would work for the SEC if given the opportunity.   But particularly in a down market, top flight agencies like the SEC no doubt received legions of applications for every position.  There is no reason to seek out applicants.  It is a " build it and they will come" approach.  Diversity, however, requires a more affirmative effort. 

This is an issue that has clearly concerned Congress.  As we have written (and Commissioner Aguilar has discussed), Dodd-Frank included an obligation by the SEC (and other agencies) to set up an Office of Minority and Women Inclusion.   It will hopefully provide a permanent voice inside the Agency for encouraging outreach and promoting diversity goals. ?

Full post as published by The Race to the Bottom on September 23, 2010 (boomark / email).