Why did anyone think this would be allowed?
A U.S. appeals court on Wednesday ruled that Nasdaq could not impose rules designed to increase diversity in corporate America by requiring companies listed on the exchange to have women and minority directors on their boards or explain why they do not.
The 9-8 ruling by the conservative-majority New Orleans-based 5th U.S. Circuit Court of Appeals found that the rules approved by the U.S. Securities and Exchange Commission ran afoul of federal securities law.
The decision is a significant legal victory for opponents of policies meant to boost racial and gender diversity in corporations.
The diversity rules were challenged by conservative think tank the National Center for Public Policy Research and Alliance for Fair Board Recruitment, a group founded by Edward Blum, who led the successful U.S. Supreme Court challenge against race-conscious college admissions policies.
“SEC has intruded into territory far outside its ordinary domain,” U.S. Circuit Judge Andrew Oldham, who was appointed by Republican President-elect Donald Trump in his first term, wrote for the majority.
The SEC said it was reviewing the ruling, which it would have to appeal to the Supreme Court to overturn. Nasdaq said that while it believed its rule would benefit companies and investors, it respected Tuesday’s ruling and would not appeal.
At issue was a Nasdaq requirement designed to bolster the diversity of corporate boards that have long been mostly white and male, studies show.
Nasdaq required companies to have at least one woman, racial minority, or LGBTQ person on their boards or explain why they do not. Companies must also disclose annually how board members identify in those categories.
It’s funny.
These boards were no doubt like “okay, so one of y’all is going to have to sodomize a young boy so we can make the quota. We’re gonna draw straws. Bring the young boy in.”
Wild nonsense.
The initiative was started by the first woman CEO of Nasdaq