Navigating the FCA’s DEI data disclosure: A comply-or-explain approach

The corporate world is evolving, and diversity, equity, and inclusion (DEI) are at the forefront. The UK’s Financial Conduct Authority (FCA) isn’t just watching from the sidelines; they’re setting the pace, urging listed companies to be more transparent about their diversity data.

In this article, we’ll dive deep into the FCA’s latest rules and the broader DEI landscape. 

And for those feeling overwhelmed? Diversio’s DEI reporting software offers a helping hand, making data collection and reporting a breeze. Stick around, and you’ll see DEI isn’t just about meeting standards—it’s a game-changer in the business world.

Quickly though, what is DEI data disclosure? DEI data disclosure is the transparent sharing of a company’s diversity, equity, and inclusion metrics, providing a snapshot of its commitment and progress in these areas. It’s a key tool for accountability and insight into the modern corporate landscape.

The regulatory shift: UK & US in focus

The DEI wave isn’t just a UK phenomenon; it’s resonating globally. The FCA has made its move, rolling out new rules that push for clearer diversity data disclosure. Their message? Companies need to be open about where they stand on DEI.

But let’s hop across the pond for a moment. The U.S. isn’t trailing behind. The Securities and Exchange Commission (SEC) has its eyes on Nasdaq-listed companies, setting its own standards for DEI transparency.

Piecing it all together, there’s a clear global momentum building. From the UK to the U.S., regulators are championing DEI, pushing for greater accountability and crystal-clear transparency. The future looks diverse, equitable, and inclusive.

FCA’s bold moves: Setting the bar high

When it comes to championing DEI, the FCA isn’t playing it safe. They’ve rolled out a Policy Statement that’s more than just words—it’s a call to action. The focus? Amplifying transparency, especially when we talk about diversity in boardrooms and among top-tier executives.

But here’s where it gets interesting. The FCA is championing a ‘comply or explain’ stance. Companies can either align with the DEI standards or be ready to explain why they haven’t. It’s a nudge, pushing firms to either step up or speak up.

And the FCA isn’t vague about its expectations. They’ve set clear diversity targets, emphasizing the need for companies to disclose their data. It’s not just about numbers; it’s about painting a clear picture of where a company stands on DEI.

Who’s in the spotlight? Scope & applicability

So, who exactly needs to pay attention to the FCA’s new Listing Rules? Well, it’s a mix.

  • If you’re a UK or overseas company with equity shares listed on the UK Official List, either premium or standard, you’re in. This includes closed-ended investment funds and sovereign-controlled companies. 
  • But if you’re an open-ended investment company or a shell company, you can breathe easy; you’re not on the list. 
  • And for those dealing with listed debt or other securities like securitized derivatives, you’re off the hook too.

Now, let’s talk about timing. If your financial year kicks off on or after  April 1, 2022, you’ll need to include these disclosures in your annual report. Here’s a pro tip: the FCA is giving brownie points for early birds. If your financial year started before that date, they’d love for you to jump on the bandwagon early.

Zooming out a bit, this isn’t just a one-off from the FCA. 

Remember their Discussion Paper from July 2021? It was their first shoutout to the financial sector about ramping up DEI efforts. And with these new Listing Rules, it’s clear they’re walking the talk. It’s likely that they’re also prepping to drop a Consultation Paper this year, which might rope in even more firms, beyond the listed ones.

In short, the FCA’s net is wide, and its message is clear: it’s time for the financial sector to focus on DEI.

Across the pond: The US’s Nasdaq rules

While the UK’s FCA is making waves, the U.S. isn’t sitting still. The Securities and Exchange Commission (SEC) has given the green light to Nasdaq’s fresh listing rules, all in the name of promoting diversity.

Companies listed on Nasdaq are now required to have, or at least explain the absence of, diverse directors. This isn’t just a ‘nice-to-have’; it’s a move to ensure companies reflect the diverse world we live in. 

The expected outcome? A broader range of perspectives in boardrooms leads to better decision-making and more inclusive corporate cultures. 

The bigger picture: DEI in the legislative arena

The legislative landscape is undergoing a transformative shift, with DEI at its core. This isn’t about sprinkling in a few new rules; it’s a global movement demanding genuine corporate accountability. Take the Racial Equity Audit, for instance. These aren’t just cursory checks; they’re deep dives into how company practices affect various racial and ethnic groups, ensuring businesses genuinely embody their DEI commitments.

And here’s where it gets compelling: shareholders are stepping up. Their demands are resonating louder than ever:

  • Over half of Apple’s shareholders supported a civil rights audit proposal in early March 2022.
  • Racial Equity Audit proposals at giants like Johnson & Johnson and Citigroup Inc. garnered the backing of over a third of shareholders in December 2022.

The message is clear. Shareholders crave transparency and accountability. Their growing influence is pushing companies not just to disclose, but to take meaningful action. In this dynamic environment, DEI is evolving from a trendy term to an integral business pillar.

How Diversio can help: Streamlining DEI data collection & reporting

Navigating the DEI landscape can feel like a maze, but that’s where Diversio steps in. We’re not just another platform; we’re your DEI partner. Our suite of services and solutions is tailored to help companies seamlessly comply with DEI regulations. From collecting accurate diversity data to insightful analysis, we’ve got you covered.

But here’s the kicker: it’s not just about compliance. With our DEI and diversity analytics & reporting software, you get a holistic view of your DEI efforts. Our tools dive deep, ensuring that the data you collect is not only accurate but also actionable. We believe in the power of data to drive change. So, whether you’re looking to meet regulatory requirements or genuinely transform your organization’s DEI culture, Diversio is here to guide you every step of the way.


DEI isn’t a fleeting trend — it’s reshaping the corporate world. As regulations tighten, companies must act, not react. But beyond compliance, DEI is a cornerstone of innovation and success. It’s time for businesses to see DEI not as a box to tick, but as a value that propels them forward.

Diversio DEI Expert
Diversio DEI Expert
Diversio's DEI expert shares everything about diversity that you need to know.
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