Goldman Sachs Group Inc. is scrapping a pledge it made to refuse initial public offering(IPO) business from companies that had fully white, male boards, Bloomberg reported on Tuesday.
The major investment bank had implemented a policy in 2020 that required it to only take a company public in the U.S. or Western Europe if it had two diverse board members, one of which must be a woman, Bloomberg reported. Goldman Sachs deciding to abandon the diversity pledge comes amid reports of conservative activists calling for several Wall Street giants to revoke policies related to diversity, equity and inclusion (DEI).
David Solomon became the CEO of Goldman Sachs in 2018, and prioritized DEI initiatives during his first year in the position, Bloomberg reported. Gregg Lemkau, who was the head of investment-banking at Goldman Sachs at the time, proposed a diversity threshold for IPOs at the end of 2019, and when Solomon asked him if the bank could do that, Lemkau said “we can do anything we want,” according to a book on the topic, the outlet reported. (RELATED: NSA Reportedly Purges Agency’s Websites Of DEI Terms)
In December, an appeals court struck down a similar rule for Nasdaq Inc.’s U.S. exchange. Shortly after returning to the Oval Office on Jan. 20, President Donald Trump issued an executive order to end “radical and wasteful” DEI programs across the federal government.
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The president stated in the executive order that the Biden-Harris administration had “forced illegal and immoral discrimination programs, going by the name ‘diversity, equity and inclusion’ into virtually all areas” of the federal government. Trump has long been a vocal critic of DEI, and campaigned to get rid of so-called “woke” ideology across the government.
Various corporations and retailers in the U.S. have begun rolling back their DEI efforts in the past year amid growing pressure from consumers and investors, including Boeing, Target and Walmart. Still, some major companies, such as Costco, have leaned into DEI efforts despite growing backlash.
“As a result of legal developments related to board diversity requirements, we ended our formal board diversity policy,” Tony Fratto, a spokesperson for Goldman Sachs, said in a statement shared with the Daily Caller News Foundation. “We continue to believe that successful boards benefit from diverse backgrounds and perspectives, and we will encourage them to take this approach.”
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