From July 2020, Goldman Sachs, an American multinational investment bank, intends to refuse to organize IPOs for companies whose board of directors does not include women, people of various races, and representatives of sexual minorities. This was announced by the head of the bank David Solomon.
The bank is ready for missing big clients. Still, in the long run, this decision should positively affect the profits of shareholders who invested in companies with a "diverse" composition of directors.
According to Solomon, in the past four years, companies with at least one woman on the board of directors have shown high effectiveness on IPOs. And Goldman Sachs itself adheres to the same policy – there are eleven people on the board of directors of the bank, including four women.
"This is an example of our saying, 'How can we do something that we think is right and helps moves the market forward?'" Solomon said.
It is worth noting that in some US states, the composition of the board of directors is regulated by law. For example, in California, a company may receive a fine of $100,000 if all directors are men. This situation has already affected the US labor market since 2019 – almost half of the vacancies on the boards of large companies' directors from the S&P 500 went to women.