Good morning,
Between Bud Light’s failure to stand behind its promotion with trans influencer Dylan Mulvaney and Target’s removal of Pride merchandise in the face of violent threats, Pride marketing has taken a beating this year.
The high-profile corporate crises have been disheartening for Fabrice Houdart, who runs the New York–based Association of LGBTQ+ Corporate Directors, which advocates for board diversity and connects board candidates with sitting directors and corporate leaders. Houdart sees recent events as more proof that boards need to prioritize sexual-orientation and gender-identity inclusion within their own ranks to better navigate LGBTQ+ issues. However, he fears that many don’t believe in the necessity of this form of diversity.
When it comes to representation on boards, a lot of directors “understand the legitimacy of gender equality or the legitimacy of racial equality,” Houdart says. “But they see LGBT equality as a frivolous kind of topic.”
To be sure, gender and racial diversity are severely lacking on U.S. corporate boards even though many companies claim they’re committed to changing that. Women now make up just over one-third of S&P 500 board directors, though white women have made the most progress toward reaching parity when it comes to board seats at Fortune 500 companies. However, among all underrepresented groups, the LGBTQ+ community faces one of the largest inclusion gaps: In 2022, fewer than 1% of S&P 500 board members self-identified as LGBTQ+, according to Spencer Stuart. That’s compared to 7.2% of the general U.S. population, according to a recent Gallup survey.
Houdart is hoping potential future requirements that force companies to share the specifics of their boards’ demographics—such as the diversity disclosure rule that went into effect for Nasdaq-listed companies last year—will accelerate the rate at which companies add LGBTQ+ members to their boards. That process ought to be seen as an urgent concern, he adds, considering that an increasingly larger share of younger Americans identify as trans or nonbinary. And business will have to respond to that shift.
Anecdotally, he believes Nasdaq’s diversity push has already led to an uptick in LGBTQ+ appointments on major company boards. Data also show that more companies are at least reporting their progress with this issue: Spencer Stuart’s 2022 Board Diversity Snapshot found that 21% of S&P 500 boards included LGBTQ+ disclosures in their proxy statements, compared to only 6% in 2021.
Houdart recognizes that not all LGBTQ+ board members will make that part of their personal identities a focus of what they bring to the proverbial table. However, he senses that, compared to the powerful LGBTQ+ directors at today’s Fortune 500 companies who came up in an era when it was safer to stay closeted, today’s younger LGBTQ+ executives will feel more comfortable and motivated to embrace their role as community champions as they begin to land board seats.
Lila MacLellan
lila.maclellan@fortune.com
@lilamaclellan
