Section 342 of the Dodd-Frank Act required all agencies subject to Dodd-Frank, including the Bureau of Consumer Financial Protection (CFPB), to create an Office of Minority and Women Inclusion (OMWI) to develop standards to assess the diversity and inclusion efforts of entities subject to regulation by these agencies. On June 10, 2015, the CFPB joined with the Office of the Comptroller of the Currency (OCC), the Board of Governors of the Federal Reserve System (Board), the Federal Deposit Insurance Corporation (FDIC), the National Credit Union Administration (NCUA), and the Securities and Exchange Commission (SEC) to issue a Final Interagency Policy Statement Establishing Joint Standards for Assessing the Diversity Policies and Practices of Entities Regulated by the Agencies (Final Standards).
The Final Standards clarified that regulated entities are not required to comply with the Final Standards, and the standards do not create any new legal obligations. Rather, compliance with these standards is voluntary. The Final Standards recognize that each entity is unique and allow regulated entities to tailor the standards to suit the size and individual characteristics of each particular entity. The Final Standards contemplate that regulated entities will implement policies to promote diversity and inclusion in four main ways:
- through an organizational commitment to diversity and inclusion
- through work place profiles and employment practices
- through procurement and business practices
- through practices to promote transparency
The Agencies contemplate that their regulated entities will use the Final Standards to complete annual self-assessments of their diversity and inclusion policies and practices and their performance under those policies. Disclosure of these assessments to the Agencies and to the public is encouraged, though the Agencies recognize that the statute contemplates a voluntary system, and disclosure of these assessments is not required. Entities that choose to submit this information will be allowed to designate the information as confidential commercial information when appropriate. The Agencies have the right to publish any information disclosed to them, so long as the published information does not identify any individual or a particular entity and does not disclose information designated as confidential.
Given the expectation that regulated entities will provide certain assessment information to the Agencies and to the public, the Agencies continue to solicit comments on the information collection process and how this process might burden or otherwise affect regulated entities. The deadline to submit comments is August 10, 2015.
Regulated entities should give careful consideration as to whether they should undertake the annual self-assessments described in the Final Standards.