Corporations Clinging To DEI Will Lose Social License to Operate
By Stefan Padfield
Americans hate racial discrimination, and they hate inequality borne of government force. However, if you try to solve the problem of inequality by engaging in Orwellian and neo-racist “discrimination in the name of anti-discrimination” (often advanced under the banners of “antiracism” and “DEI” — “diversity, equity, and inclusion”), then you will sooner or later experience the wrath of the people. The recent judicial rebuke of Nasdaq’s diversity rule adds to the drumbeat of feedback alerting corporations to this fact: If corporations want to maintain their social license to operate, then they must stop discriminating on the basis of race.
In National Center for Public Policy Research (NCPPR) v. SEC, the en banc U.S. Court of Appeals for the Fifth Circuit vacated the SEC’s approval of Nasdaq’s “Board Diversity Rules.” I work for the National Center, and our excellent attorneys at the New Civil Liberties Alliance (NCLA) described the discredited rules as follows: “These Rules imposed gender, race and sexual orientation quotas on corporate board membership for Nasdaq-listed companies, compelling those that failed to meet their board seat quotas to explain why or face involuntary delisting from the stock exchange.”
You can read the National Center’s press release as well as NCLA’s press release for more detailed analysis of the case. The short of it is that the SEC exceeded its statutory authority in approving the rule because the rules advanced none of the express purposes of the governing statute, but were instead a thinly veiled attempt to shame corporations into advancing the forced neo-racist social engineering that’s become so popular as “antiracism” the past few years…
December 24, 2024
Originally Published in RealClearMarkets