SEC’s OMWI Releases Diversity Assessment Report and Annual Report

May 6, 2022

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The SEC’s Office of Minority and Women Inclusion (OMWI) has issued its 2020 Diversity and Assessment Report and its Annual Report to Congress.

2020 Diversity and Assessment Report: In 2020, OMWI invited SEC-regulated firms to conduct and submit voluntary self-assessments of their diversity policies and practices. OMWI received only 59 responses that cover 118 firms. OMWI states that greater participation is needed to obtain a more comprehensive understanding of these issues and that increasing the response rate “remains a priority.” The IAA believes that data is foundational to understanding and developing policies relating to diversity, equity, and inclusion (DEI) and accordingly has voiced its strong support of a bill that would amend the Dodd-Frank Act to allow agencies to require regulated entities with more than 100 employees to provide diversity information to OMWI.

The five key areas addressed in the self-assessments and related observations are:

• Organizational commitment to diversity and inclusion: Most of the responding firms consider diversity and inclusion in their strategic plans for recruiting, hiring, retaining, and promoting employees. Fewer firms “take proactive steps to promote a diverse pool of candidates” in selecting members of a firm’s board of directors.
• Implementation of employment practices to promote workforce diversity and inclusion: Most firms engage in events to attract minority and women candidates, but fewer firms “regularly evaluate their performance under workforce diversity and inclusion programs” or “include diversity and inclusion objectives in performance plans of managers.”
• Consideration of supplier diversity in procurement and business practices: Just over half of the firms contact minority and women organizations regarding contracting opportunities, but fewer firms publicize procurement opportunities in media directed to minorities and women. Approximately one-third of the firms measure their percentage of contracts with sub-contractors that are owned by minorities or women. The report states that supplier diversity “may present the greatest opportunity for improvement.”
• Practices to promote transparency of organizational diversity and inclusion: Most firms publish information about their commitment to diversity and inclusion. Fewer firms publish their strategic plans in these areas.
• Evaluation of diversity policies and procedures: Around 70 percent of firms monitor and evaluate their performance under diversity policies and procedures. Fewer than one-third of firms publish information about assessments of their diversity policies and procedures.

The report includes a list of diversity practices that firms included in their responses.

Annual Report: This report to Congress focuses on the SEC’s progress toward its internal diversity and inclusion goals. It also discusses the self-assessments by industry participants described above and OMWI’s plans to host campaigns to demonstrate the importance of DEI and the value of submitting self-assessments to the SEC. OMWI also describes the assistance that it provided to the SEC’s Asset Management Advisory Committee’s (AMAC’s) Diversity and Inclusion Subcommittee and the subcommittee’s report that was adopted by the AMAC.

IAA Resources: The IAA has an active Diversity, Equity & Inclusion Committee as well as member resources on our website regarding DEI, including A Practical Guide to Building Diversity, Equity & Inclusion At Your Firm.

See 2020 Diversity Assessment Report; Annual Report to Congress; and related Press Release.