NASDAQ recently proposed new diversity requirements for the corporate boards of companies listed on the exchange. "Successful companies must cultivate diversity to fuel innovation and to thrive in today's era of ongoing environmental, social and economic change," said TechNet president and CEO Linda Moore in support of the proposal. The NASDAQ proposal arbitrarily determines that a minimum of two directors must be female, minority, or LGBT. The criteria are not linked in any meaningful way to the demographic profile of society; they merely reflect the do-gooder biases of NASDAQ executives and influencers.
The proposal, does, however, raise interesting questions about the broader implications of diversity. Whether diversity is valuable to a business—or for that matter, to a student body, university faculty, or knitting circle—depends greatly on the circumstances. Diversity may indeed serve a socially beneficial purpose by elevating underrepresented identity groups, or it may be just good PR, but other personal characteristics—intelligence, experience, qualifications—are usually more relevant to a job. At school, diversity can have educational value by exposing students and teachers to people from a wide variety of backgrounds. In government, diversity addresses concerns, judicious or not, about "fair" representation. The point is that the context matters.
Equality of opportunity could achieve most diversity goals, if the pools of candidates representing various identity groups had comparable qualifications. They seldom do, however, which has led to many forms of affirmative action. Such programs are typically zero-sum because they involve allocating a scarce resource, and in practice they typically end up as exercises in political power and greasing the squeakiest wheels.
Affirmative-action programs are also in tension with meritocracy, a foundational principle of the American ethos. We're seeing a struggle between these principles play out at Harvard and Princeton, as groups representing prospective Asian students fight for merit-based admission policies rather than ones constrained by identity-based class composition. Even voters in liberal California have repeatedly backed merit over the years, rejecting a ballot initiative last month that would have effectively repealed a state ban on racial quotas passed in 1996.
Perhaps we should focus less on arbitrary diversity quotas and preferences and do more to expand the pools of qualified candidates across the identity spectrum. Charter schools and improved public education are proven vehicles for boosting underprivileged and minority enrollment at the most demanding universities, and thus access to better jobs. Yet we continue to elect politicians in thrall to the teachers' unions that reject these remedies. Where are the social-justice warriors for this cause?
We also too often ignore the importance of family structure as a stepping stone to success; it helps explain, for example, why Asian-Americans are overrepresented at elite universities, and why African-Americans are not. Finding policy levers to shift this dynamic is far preferable to attempting to achieve equal representation by arbitrary and coercive methods.
What is the limiting principle of affirmative action? Should the selection of opinion columns in a newspaper be based primarily on the race, ethnicity, or gender of the authors? (Some major newspapers and cable TV networks are already doing this.) New examples pop up almost daily in which someone asserts that "non-proportionate" outcomes are illegitimate as such—not enough minority nominees for Oscars or Emmys, for example. Why not extend that reasoning to Nobel Prizes, Stanley Cups, or any other coveted achievement?
Efforts to force proportionate outcomes are also demotivating and divisive. The attempts to move away from merit-based tests and grades for elite public schools in many of America's big cities will inevitably diminish these schools' ability to put any students on an accelerated path. Some school districts have even considered eliminating advanced programs because of unequal minority representation. The inevitable outcome will be to teach universally to standards set by the least able students: a race to the bottom.
Andrew I. Fillat spent his career in technology venture capital and information technology companies. He is also the co-inventor of relational databases. Henry I. Miller, a physician and molecular biologist, was a consulting professor at Stanford University's Institute for International Studies and a fellow at the Hoover Institution. Both were undergraduates at MIT.