May 10 2018
Washington - Today, Senator Dianne Feinstein joined Kamala D. Harris (Both D-Calif.) in introducing the Diverse Leadership Act, legislation to ensure that at least one minority and one female candidate are interviewed for each vacancy for the presidency of a reserve bank at each of the twelve reserve banks in the Fed (San Francisco, Boston, New York, Philadelphia, Cleveland, Richmond, Atlanta, Chicago, St. Louis, Minneapolis, Kansas City, and Dallas). In addition to Feinstein, Sens. Cory Booker (D-N.J.) and Kirsten Gillibrand (D-N.Y.) are lead co-sponsors of this bill. Of the more than 130 individuals who have served as presidents of the twelve reserve banks, only 3 have been non-white. In 2017, Raphael Bostic became the first African American reserve bank president when he became president of the Atlanta Fed. Additionally, there have been only six women to ever serve as a reserve bank president.
This bill is the Senate companion to legislation introduced by Rep. Joyce Beatty (Ohio-03). The House version was introduced in October 2016 and reintroduced in January 2017, the Ensuring Diverse Leadership Act of 2017, H.R. 485.
“The Federal Reserve’s regional banks have extraordinary economic influence,” said Senator Feinstein. “To improve their ability to represent all Americans, the banks’ leadership needs to look more like our country. Requiring consideration of female and minority candidates is an important step toward promoting more diversity and will help the Federal Reserve’s leadership better understand and support our economy.”
“Diversity is critical to ensuring all voices are represented and heard in our government, and critically important on matters that affect our nation’s economy,” said Senator Harris. “It’s long past time the Federal Reserve do more to guarantee that their heads of the table reflect those they serve. With the president of the Federal Reserve of San Francisco leaving next month and the search for his replacement underway, the need for this Diverse Leadership Act is urgent.”
“It is hard to believe that up until last year, in the Federal Reserve’s 105-year history, no African-American had ever served as a regional bank president and only six women ever held the position,” said Congresswoman Joyce Beatty. “To build a stronger economy, we need the talents, skills and expertise that diversity offers—and the Ensuring Diverse Leadership Act will do just that. I am proud to lead the charge in the House on this all-too important bill and am honored to have Senator Kamala Harris spearhead the companion piece of legislation in the U.S. Senate.”
“Federal Reserve Bank presidents are some of the most important policy-making individuals in our economy,” said Senator Booker. “But for too long, those positions have been effectively shut off from women and people of color. If we’re serious about creating an inclusive, strong, and sustainable economy, no one should be left on the sidelines. Our bill reflects an important first step in ensuring that our nation’s policymaking institutions accurately reflect our country’s rich diversity.”
“The Federal Reserve plays a powerful role in shaping our nation’s economic and regulatory policy, and it needs leadership that will put the interests of working families first and bring diversity and a different perspective to the table,” said Senator Gillibrand. “The New York Fed has never been led by a woman, and the national Federal Reserve has never been led by a person of color. That needs to change. Well-qualified candidates who would bring diversity to the Federal Reserve should not be overlooked. It’s unacceptable that these powerful positions are virtually unchecked by Congress, and we need a more transparent process, including Congressional oversight and a public confirmation process, to hold the leadership of the Federal Reserve accountable.”
In addition to ensuring diverse candidates are interviewed for the position of president, the bill would also require that reserve banks submit a report to the Senate Banking Committee, the House Financial Services Committee, and the Office of the Inspector General of the Federal Reserve System within 60 days of filling a vacancy for a presidency detailing how many candidates were considered and providing demographic information on them. The bill would also make technical corrections to the Federal Reserve Act to replace the term “Chairman” with the term “Chair.”
The Diverse Leadership Act is influenced by the National Football League’s “Rooney Rule,” which was established in 2003 to boost diversity among the league’s head coaching positions. The adoption of this policy has more than doubled the number of NFL coaches of color in the first twelve seasons of its use, when compared to the first twelve seasons beforehand.
Bill text is available here.