Last year, Goldman Sachs dropped a commitment to support board diversity for clients it was taking publicly. Now it plans to drop diversity criteria for its own board.
Goldman Sachs CEO David Solomon.The Wall Street giant will consider race, gender identity, sexual orientation and other diversity factors when the board identifies potential candidates, according to people familiar with the matter.
The board’s governance committee currently finds qualified candidates based primarily on four factors, one of which is a broad description of diversity, such as “other demographics” in addition to perspective, background, work and military service, which includes a list of DEI factors.
Now it plans to cross “other demographics,” including race, gender identity, ethnicity and sexual orientation, the people said.
Goldman’s decision follows a behind-the-scenes request from the conservative activist nonprofit National Legal and Policy Center, which owns a small portion of the bank. The group submitted a proposal to the firm in September, to remove the DEI criteria, the people said. The group requested that its proposal be included in Goldman’s proxy statement that will be circulated to shareholders ahead of the firm’s annual shareholder meeting this spring.
Goldman informed the NLPC that it planned to remove the DEI criteria, and an agreement was signed between the two parties that included the labor group withdrawing its proposal. Goldman’s board is expected to approve the new language this month, the people said.
The NLPC has argued to several companies that the issue of diversity raises the risk of discrimination when identifying qualified individuals for board membership.
Goldman, like many big banks, has returned to DEI efforts over the past year. It also deleted references to race, including its diversity program, One Million Black Women, a multibillion-dollar commitment to invest in black business and nonprofit leaders.
It also ended its requirement that US and Western European companies have separate boards for banks to take companies public.
Goldman faced anti-DEI proposals during last year’s proxy season but shareholders did not approve those changes.
The DEI climate for banks and many other companies has changed radically in recent years. A turning point was President Trump’s executive order early last year directing federal departments and agencies to launch civil investigations into companies’ DEI programs.
Write to AnnaMaria Andriotis at annamaria.andriotis@wsj.com
