The SEC, together with the OCC, the FDIC, and three other federal agencies, have issues a Proposed Interagency Statement for assessing diversity policies for regulated entities.  The Dodd-Frank Act mandated that each of the agencies establish an Office of Minority and Women Inclusion (OMWI) and that the Directors of such offices develop standards for assessing diversity polices at regulated entities.  The proposed standards would assess organizational commitment to diversity (employment, policies/procedures, education/training, senior office); workforce profile (using data to evaluate inclusion, holding management accountable, outreach); procurement practices (using minority and women-owned vendors); and transparency (publication of plans and data).  The Interagency Statement proposes self-assessments and public reporting instead of exams.

OUR TAKE: Once regulated, firms are subject to the full panoply of government supervision including diversity policies.  We expect that firms will ultimately have to add these standards to their compliance policies and procedures and appoint one senior executive responsible for diversity initiatives.