Out Leadership, CalPERS Press ASX to Keep LGBTQ+ Diversity in Board Rules

Out Leadership and CalPERS are urging the Australian Securities Exchange to preserve LGBTQ+ and other diversity categories in its corporate governance code as the exchange rewrites its board diversity guidance. The groups say removing those categories would weaken disclosure, narrow board-building standards and signal a broader retreat from inclusive governance.

Why it matters: - The Australian Securities Exchange is revising the rules that shape how listed companies think about board diversity. - If the ASX drops LGBTQ+ status and other named characteristics, gender would be the only diversity category explicitly tracked in the code. - Investors and governance groups say that would leave Australian boards with less guidance than what many large shareholders already expect. - The decision could influence other markets watching whether Australia follows U.S. rollbacks or keeps broader disclosure standards.

What happened: - Out Leadership and CalPERS filed a joint submission urging the ASX to keep LGBTQ+ status and other diversity characteristics in its Corporate Governance Principles and Recommendations. - The ASX has proposed shifting diversity guidance into a separate Australian law that only covers gender. - The proposal would remove named reference to sexual orientation, gender identity, ethnicity, disability and religious belief from the exchange’s rulebook. - Out Leadership and CalPERS also asked the ASX to restore the prior list of characteristics and add First Nations heritage and veteran status.

The details: - Out Leadership has operated in Australia since 2013, runs an annual Sydney summit and has engaged the Australian Institute of Company Directors on board diversity since 2019. - In March 2023, Out Leadership published Australia’s first LGBTQ+ inclusive board diversity guidelines, which the AICD shared with its members. - The model board matrix in those guidelines included Aboriginal and Torres Strait Islander heritage, sexual orientation, gender identity, age, cultural background and disability. - Out Leadership says its OutQUORUM research has reviewed every ASX 200 company board diversity policy annually since 2023. - The group describes that work as the only continuous cross-exchange measurement of inclusive board diversity in the world. - A 2024 draft would have made the ASX the first major exchange to expressly name sexual orientation among board diversity characteristics. - The ASX withdrew that draft in February 2025 after a contested consultation. - The July 2026 replacement draft removes every named characteristic except gender. - In 2024, the Australian Council of Superannuation Investors, the AICD and Chief Executive Women asked the ASX in writing to name broader characteristics, including LGBTQ+ identity. - BlackRock directs the 300 largest ASX companies to weigh LGBTQ+ status, Indigenous heritage, disability and veteran status when building boards. - BlackRock has kept that guidance in place through 2026 even as some U.S. companies have pulled back from diversity commitments. - CalPERS manages roughly $637 billion for 2.4 million current and former California public employees. - CalPERS became the first public pension fund to join Out Leadership in 2023. - CalPERS proxy guidelines direct boards worldwide to weigh diversity of gender, age, nationality, race, sexual orientation, gender identity, disability and historically underrepresented groups.

Between the lines: - Out Leadership and CalPERS frame the request as a restoration, not a new mandate. - The groups say the change would not create a target, quota or reporting requirement. - The change would not force any director to disclose personal information. - The only effect would be on explanatory guidance inside the code, not on binding rules. - Out Leadership argues the ASX already has evidence that naming a category changes outcomes. - Todd G. Sears, founder and CEO of Out Leadership, said the gender target worked because it was “named, measured and reported on.” - Sears said the same approach should apply to LGBTQ+ people, First Nations Australians and veterans. - The groups also point to market data from prior diversity rule changes. - Out Leadership says ASX 200 companies naming LGBTQ+ people in board disclosures rose from 18 to 63 over the past year. - Out Leadership says its research was cited seven times in the SEC filing behind the Nasdaq Board Diversity Rule. - While the Nasdaq rule stood, inclusive board policies at Nasdaq companies rose from 4.2% to 50.6%. - After a U.S. court struck down the rule in 2024, Out Leadership and CalPERS say disclosures fell 83% in the following cycle.

What’s next: - Out Leadership and CalPERS said they are willing to brief the ASX Advisory Group on Corporate Governance directly. - Out Leadership’s full 2026 OutQUORUM report is due Oct. 1, 2026. - The ASX’s final rulemaking outcome will determine whether sexual orientation, gender identity and other characteristics remain part of the exchange’s governance guidance.

The bottom line: - The ASX is being pressed to keep LGBTQ+ inclusion visible in board diversity rules before its rewrite narrows the field to gender alone.