(Bloomberg Opinion) -- The Nasdaq stock exchange is poised to push businesses to a new level of inclusion with its proposal to require all listed companies to have at least two diverse board members, but we are dismayed that it took such a narrow definition of who qualifies. Notably absent are persons with disabilities.
This omission leaves out a segment of individuals who represent more than $8 trillion in purchasing power, not to mention a largely untapped workforce of millions of qualified Americans eager to find competitive, integrated employment. What’s more, research shows that companies that embrace disability employment and inclusion outperform their peers. These companies have 28% higher revenues and are twice as likely to have higher total shareholder returns than those in their peer group.
It's impossible for a company to consider its board of directors truly diverse and inclusive if people with disabilities are not acknowledged as able to provide expertise and insights that foster long-term value creation by companies — for investors and society alike.
We know the disability community well. They appreciate that the Nasdaq Inc. proposal isn't some form of “tokenism” and see the business and social value in it. People with disabilities want the opportunity to lead companies because they have a unique skill set and experiences — ones that are highly relevant in a Covid-19-disrupted workplace. The workplace, and society as a whole, were forced by the pandemic to adapt to a way of work long practiced by those with disabilities — a reliance on technology, ingenuity, flexibility and remote places to work. Those skills — and the mindset behind them — are at a premium today.
Diversity and inclusion contribute to that value creation by bringing together a broad set of experiences, opinions and insights to build demand-driven markets for their products that simultaneous meet a human need while solving a challenge for society through innovation.
We do not need to look far to see accessible innovation at play in our everyday lives.
Consider innovations like audio books, cruise control in vehicles, the keyboard, Amazon.com Inc.'s Alexa, Segway electric transporters, and the voice-activated dictation feature on your iPhone. The technology underlying each of these products was brought to market to assist people with disabilities. Their broader applicability was quickly appreciated and the products were adapted into products designed for mass use. All meet a human need while solving a societal challenge.
As Nasdaq rightly noted, Americans are paying increased attention to the social aspects of business — environmental, social and governance issues such as racial and gender inequality and climate change — but disability inclusion continues to be left behind.
Adding disability, as defined by the Americans with Disabilities Act, to the Nasdaq rule will make a tremendous difference. We know greater diversity among leadership frequently leads to greater diversity throughout the organization. Board members with disabilities not only provide value to the company but also to the disability community and the employees with disabilities who want to work but too often are overlooked.
When I delivered my farewell speech to the U.S. Senate six years ago, I noted that the unemployment rate among adult Americans with disabilities — more than 60% — was a blot on our national character. Yet, today, that number remains largely unchanged. What’s worse, we know that people with disabilities are more likely to lose their jobs in times of economic downturn. In the first half of 2020, 20% of workers with disabilities lost their jobs compared with 14% of the general population.
Investors can greatly influence corporate America’s commitment to environmental, social and governance issues by where and how they choose to invest, and Nasdaq's requirement for greater diversity — or explanations for the lack thereof — can go a long way to providing investors information to make sound decisions.
However, those requirements need to be more holistic. People often identify with more than one diverse population. People of color and people with disabilities, for instance, often are not mutually exclusive but rather mutually reinforcing. We cannot address disparities for one without addressing disparities for both.
Companies unwilling or unable to adopt a value-creating mindset through a commitment to diversity and inclusion owe it to their investors, employees, customers and others to explain why. We can then decide if they are worthy of our trust and support.
Again, we commend Nasdaq for its efforts to foster greater diversity on corporate boards. But to achieve its vision of a more inclusive private sector, Nasdaq must do a better job of recognizing the intersectionality of diversity. Disabilities cut across all of us, regardless of gender, ethnicity or sexual orientation.
This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.
Tom Harkin is a former U.S. senator from Iowa. He was lead sponsor of the Americans with Disabilities Act. He is the founder of the Harkin Institute for Public Policy & Citizen Engagement at Drake University.
Robert Ludke advises policy makers and executives on how businesses can create long-term value for society. He is a fellow at the Harkin Institute researching the role investors can play in advancing employment opportunities for people with disabilities.
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