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Board diversity continues to be at the forefront of corporate governance discussions, widely recognized as both a matter of equity and a driver of stronger decision-making and business performance. Yet, recent political and regulatory developments have raised new questions about its trajectory. Following President Trump’s executive order terminating diversity, equity and inclusion (DEI) programs in the federal government, public companies have also started to reassess their own commitments. While the executive order only applies to federal agencies, its ripple effects are evident amongst public corporations, where larger companies in particular appear to be slowing or scaling back DEI initiatives. This raises the question on potential long-term impact for underrepresented ethnic groups.
Data from the Russell 3000 indicates that ethnic diversity among new board appointments declined in recent years. The prevalence of ethnically diverse individuals filling new board seats fell sharply, dropping from 23.3% in 2022 to 18.2% in 2024—a 21.9% decrease.
A major contributor to the decline in ethnic diversity comes from Black/African American and Hispanic/Latino representation. Newly appointed Black/African American directors decreased 33.3% from 2023 to 2024 and have fallen by more than 50% compared to 2022. Hispanic/Latino appointments also dropped 23.8% from 2023 to 2024. In contrast, new appointments of Asian/Pacific Islander directors rose by 8.9% in 2024. Taken together, these shifts indicate that ethnically diverse directors are filling these new board seats at significantly lower rates than in previous years prior, contributing to the slowdown in increased ethnic representation across boards.
While the representation of ethnically diverse directors grew 13.7% between 2022 and 2024, year-over-year data shows a 0.5% decline from 2023 to 2024, driven primarily by fewer new ethnic appointments highlighted in figure 1.
Although representation is not growing at a rapid pace, there have been small increases in the prevalence of ethnically diverse directors across Russell 3000 companies. Asian/Pacific Islander directors saw the largest increase in representation since the end of 2022, from 5.6% to 6.7% 2024, a 19.6% increase. By the end of 2024, Black/African American (7.9%) Russell 3000 board members were the most prevalent ethnic group, followed by Asian/Pacific Islander (6.7%) and Hispanic/Latino (3.6%).
However, when compared to the previous year, progress slowed considerably. Following the overall decline in newly appointed ethnically diverse directors shown in figure 1, all three groups saw either no growth or slight decreases from 2023 to 2024. Asian/Pacific Islander representation fell by 1.5%, Black/African American directors decreased by 1.3% and Hispanic/Latino representation remained unchanged.
The utilities sector stands out for having the highest share of Black/African American directors at 12.2%—the strongest representation not only across sectors but also compared with other ethnic groups. Among sector-specific ethnic representation, technology leads at 23.8%, followed closely by utilities (23.3%) and consumer defensive companies (22.5%). By contrast, energy lags significantly, with just 14.8% of its board seats held by ethnically diverse directors.
This analysis of the Russell 3000 shows that while some sectors like utilities and technology maintain relatively high representation, ethnic diversity has declined, particularly among Black/African American and Hispanic/Latino directors. Board diversity continues to be a key element of corporate governance, and changes in the political and regulatory environment are likely to be reflected in future corporate diversity initiatives.
Associate Editor
Joyce Chen, Associate Editor at Equilar, authored this post. Jeremy Ho, Senior Research Analyst, contributed data and analysis. Please contact Amit Batish at abatish@equilar.com for more information on Equilar research and data analysis.
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