Goldman pares back DEI language from board criteria; affects Goldman Sachs BDC

Boardroom criteria rewritten as Goldman pares back DEI language

Goldman Sachs is removing an explicit diversity, equity and inclusion reference from the criteria its board uses to evaluate director candidates, a change that extends a shift the bank began last year and that is reverberating through governance circles. The bank’s nominating and governance committee currently assesses candidates on four factors including a traditional notion of diversity — viewpoints, background, work and military service — and appends “other demographics” to cover race, gender identity, ethnicity and sexual orientation. Goldman plans to delete that appended reference this month, according to people familiar with the matter.

The move follows a request from the National Legal and Policy Center, a conservative nonprofit that owns a small stake in Goldman, and sources say the bank struck a deal so the group will not circulate a formal shareholder submission before the annual meeting. The change mirrors an earlier decision by Goldman to drop a diversity requirement for companies it advises on initial public offerings, a step that governance analysts say signals a more hands‑on repositioning of the firm’s public stance on DEI standards. The bank’s governing committee continues to emphasise professional experience and independence as central evaluation metrics.

The revision has specific resonance for Goldman Sachs BDC, the firm’s publicly traded business development company, and for other investment vehicles and asset managers that use parent‑bank governance models as a template. Analysts and corporate governance advocates note the alteration could prompt similar reviews of nomination practices across closed‑end funds and BDCs that tie their director screening to broader firm policies. The removal reshapes how firms in the alternative‑finance and asset‑management space document non‑financial criteria for board selection and may prompt questions about how companies balance demographic inclusion with skills and independence in recruiter and nominating committee deliberations.

Conservative advocacy and proxy access

People familiar with the discussions say the NLPC’s request precipitates the change and that the voluntary board action avoids a contested proxy fight or a formal shareholder vote. By agreeing to revise the language internally, Goldman sidesteps inclusion of the request in proxy materials distributed to shareholders ahead of its annual meeting.

Political backdrop and industry implications

Observers link the rollback to a wider retrenchment of DEI initiatives since the presidential transition, noting recent executive orders aimed at curbing government DEI programs and rhetoric calling for “merit‑based” approaches. The episode is prompting scrutiny from investors, proxy advisers and civil‑society groups about how major financial institutions define and disclose diversity criteria in board selection.