With new political environment, Goldman Sachs abandons inclusion rules on its board

Goldman Sachs is taking another step away from the diversity requirements it has long championed on Wall Street.

Goldman will no longer explicitly take race, gender and sexual orientation into account when evaluating a potential board member, according to two people with knowledge of the bank’s decision, who were unable to comment publicly because of the confidential nature of the move.

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The decision is the result of an agreement reached by Goldman with the National Legal and Policy Center, a conservative nonprofit group that has been pressuring several companies to abandon diversity, equity and inclusion projects, the sources said.

The group recently announced similar deals with American Express and equipment maker Deere & Co..

As part of the deal with Goldman, the National Legal and Policy Center, which owns a small stake in the bank, withdrew a shareholder proposal that called for an end to board diversity criteria. The deal was previously reported by The Wall Street Journal.

Goldman’s move is part of a broader retreat by American companies from diversity projects during the Trump administration. The White House says many of these initiatives amount to discrimination against white workers and job seekers.

For years, Goldman CEO David Solomon has been a vocal supporter of the bank’s commitment to reshaping a traditionally white male-dominated workforce.

In March 2019, Solomon, his top deputy, John Waldron, and the company’s then-chief financial officer, Stephen M. Scherr, declared diversity and inclusion “a top priority.”

“When we unite around a common goal, we move forward together,” the executives wrote in an email to employees.

They said they would “improve every year” toward goals that included a new recruiting class made up of “50% women, 11% Black professionals and 14% Hispanic/Latino professionals in the Americas, and 9% Black professionals in the United Kingdom.”

The following year, Solomon said that Goldman would not take a company public in the United States or Europe unless it had at least one “diverse” board member. In 2021, the company would need to have at least two diverse board members for Goldman to agree to work on its initial public offering.

But since President Donald Trump returned to office, the political and legal winds surrounding diversity have changed — and so has Goldman’s commitment to diversity.

Last year, the Equal Employment Opportunity Commission began questioning hiring practices at elite law firms, alleging that their efforts to recruit black and Hispanic lawyers may have discriminated against white candidates.

More recently, the agency said it was investigating “systemic allegations of intentional diversity-related racial discrimination” against white employees and candidates at Nike. The sporting goods company said it was cooperating with the EEOC investigation.

Even before Trump began his second term, some diversity initiatives were already facing legal challenges. In late 2024, a federal appeals court declared invalid Nasdaq rules that established racial and diversity goals for boards of companies listed on its exchange.

In February last year, Goldman said it would abandon the policy that required boards of directors of American companies to include women and members of minority groups in order for the bank to act as coordinator of their initial public offerings.

That same month, the company also eliminated the explicit goals it had previously set for the racial and gender composition of its recruiting classes.

“This does not change our strong belief that successful boards benefit from diverse backgrounds and perspectives,” a Goldman spokeswoman, Jennifer Zuccarelli, said of the recent moves.

Goldman’s board is expected to move forward with changing diversity criteria for potential members when it meets this week, the two people with knowledge of the matter said.

The meeting will be the board’s first since it met last week to consider the resignation of Goldman’s chief legal officer, Kathryn Ruemmler, who said she was stepping down after revelations emerged about her extensive relationship with Jeffrey Epstein.

At the bank’s annual shareholder meeting last year, National Legal and Policy Center associate director Luke Perlot praised Goldman for having “taken significant steps to scale back its diversity programs.”

Still, he proposed that the bank eliminate diversity, equity and inclusion goals tied to the compensation of its top executives. At that point, the bank’s board recommended not eliminating these goals, and less than 5% of shareholders voted in favor of eliminating them.