The exchange operator filed a proposal with the SEC on Tuesday that would require listed companies to have at least one woman on their boards, in addition to a director who is a racial minority or one who self-identifies as lesbian, gay, bisexual, transgender or queer. Companies that don’t meet the standard would be required to justify their decision to remain listed on Nasdaq. In a review carried out over the past six months, Nasdaq found that more than three-quarters of its listed companies would have fallen short of the proposed requirements.
“We are going to make it so that every company has a very straightforward way to meet the standards,” Nasdaq Chief Executive Adena Friedman said in an interview. The move is unlikely to deter companies from listing with Nasdaq, according to Scott Yonker, a professor of finance at Cornell University. “The cost of doing this is relatively minor,” he said. Because many big companies have become more diverse in recent years, they likely won’t struggle much to find board members who meet the requirements, Mr. Yonker said.