When the US Securities and Exchange Commission gave the Nasdaq the green light for its new board diversity reporting initiative, it rightly encompassed women, racial and ethnic minorities, and LGBTQ + people. But people with disabilities were left out.
As a childhood bone cancer survivor, amputee, and disability advocate, I see this decision as the latest snub for the 33 million working-age people with disabilities in American companies. Several states, including California, Maryland, Illinois, and New York, have also failed to include corporate diversity-related disability requirements for companies based in those states.
Even 31 years after the Americans with Disabilities Act was passed, systemic biases still have a strong influence. The ADA calls people with disabilities a “discrete and isolated minority” who have faced discrimination and inequality. But we are still not related to other under-represented minorities such as women and people of color. We are still not considered important enough to include in corporate diversity metrics, nor do we have the same business opportunities that are offered to other heterogeneous groups.
Corporate America’s argument against including disability in corporate diversity metrics is often based on the lack of data. Businesses and regulators routinely say that there isn’t enough data to show that people with disabilities can improve their financial performance and contribute to good governance. But they can – and do.
An Accenture report, Getting to Equal: The Disability Inclusion Advantage, found that companies advocating disability initiatives outperform their peers. On average over a four-year period, these companies achieved 28 percent higher revenues, double net income, and a 30 percent higher economic profit margin. The total shareholder returns were also higher. In addition, a more diverse workforce, which better reflects the makeup of today’s society, appeals to younger generations of workers.
The challenge in collecting empirical data on disability is that not enough employees self-disclose their disability in the workplace and not enough companies measure disability inclusion. Many workers fear that “coming out” could harm their careers because of the stigma surrounding disability. In the latest Disability Equality Index (DEI), of the 319 participating companies – including 67 Fortune 100 – only 5 percent of employees and 10 percent of senior executives reported having a disability.
It is for this very reason that disability should be included in all business diversity requirements. When employees begin to see disability as a strength, they feel more comfortable than working with their authentic selves and asking about the precautions they need to be successful in their jobs. Companies then get more accurate data and can begin comparing their disability integration efforts – and financial performance – with industry peers.
70 top CEOs have signed the CEO Letter on Disability Inclusion. Many civil rights organizations have also expressed their support, including The Leadership Conference on Human Rights, National LGBT Chamber of Commerce, National Veteran-Owned Business Association, US Black Chamber, United States Hispanic Chamber of Commerce, US Pan Asian American Chamber of Commerce, Women Influence Public Policy and Out & Equal.
People with disabilities bring diverse skills and unique perspectives to all levels of a company, including company boards. Nasdaq would have done well to look to the Toronto Stock Exchange, which requires public companies to disclose the number and percentage of board seats and leadership positions held by women, indigenous peoples, people with disabilities, and members of visible minorities.
Or they could have orientated themselves on the UK’s Financial Conduct Authority, which wants to incorporate obstacles in comprehensive new transparency rules and targets for companies listed in the UK. Or they could have taken a page from the SEC itself, which recently passed disclosure rules to include human capital management: U.S. public companies are now required to report material information like diversity and inclusion initiatives and statistics in their 10-Ks and other filings .
Investors increasingly see diversity and inclusion as an integral part of environmental, social and governance (ESG) investments. The representation of people with disabilities in diversity is directly in the “S” of ESG and is anchored in the materiality. For this reason, 30 institutional investors with a volume of $ 2.8 trillion signed the joint investor declaration on the inclusion of people with disabilities, in which they call on American companies to adopt the DEI and report their initiatives to promote disabilities. Massachusetts and New York also revised voting guidelines for their public pension funds, vowing to screen boards of directors who are not sufficiently diversified, including people with disabilities.
Seven years ago, Disability: IN and the American Association of People with Disabilities launched the DEI to provide a tangible way for businesses to measure and report disability inclusion and equality. In light of the Nasdaq’s decision, the 2022 index will include three new questions to determine whether companies are seeking nominations for board members with disabilities and are reporting this information publicly. Disability: IN has also partnered with data solutions company Equilar to add a database flag that will help more than 1,000 companies identify candidates with a disability for appointment to executive teams and board members.
For too long, people with disabilities have been marginalized in employment because of fears, myths and stereotypes about their ability to do their jobs well. That alone is reason enough to include them in diversity measures. While Nasdaq and others have missed the opportunity to hold the torch, the disabled community is now prepared for them to be disfellowshipped again.
The number is strong, and with the right corporate governance, people with disabilities have an opportunity to prove they belong in business.
Ted Kennedy, Jr., is a disability rights attorney, co-chair of the Disability Equality Index, and Immediate Past Chair of the American Association of People with Disabilities.
The views in this article are one’s own.