FINRA DRS launched an annual Neutral Roster Demographic Survey in 2016. Recall that this is an annual, voluntary, and confidential survey of neutrals that FINRA relies on to keep its diversity statistics accurate and up-to-date. DRS promises to publish annual survey results at the beginning of each year, and true to its word, the Authority’s updated 2021 demographic survey results were posted on December 31.
In Short: Much Progress is Being Made
To track progress, FINRA: “hired a third-party consultant to survey - on an anonymous and voluntary basis - the demographics of the neutrals on our roster from 2017 to 2021. In sharing the findings, FINRA strives to provide transparency about the current makeup of our arbitrator roster. In 2021, we saw increases across a number of categories….”
Changes in the Past Year
What are the results? We reached out to DRS EVP and Director of Arbitration Rick Berry, who offered these thoughts: “Our 2021 demographic survey of the roster demonstrates our best results since we began tracking progress in 2016. The 2021 survey showed that we outperformed versus 2020 in key demographic groups. Of the new arbitrators added this year:
· 45% were female (40% in 2020)
· 23% were African-American (14% in 2020)
· 7% were Hispanic/Latino (3% in 2020)
· 6% were Multiracial (3% in 2020)
· 5% were LBGTQ (2% in 2020)
· 4% were Asian (same as 2020)
“It is noteworthy that we had great success despite not being able to hold in-person recruitment events due to the pandemic. I’m particularly proud of our recruitment team for being innovative through social media and for continually evolving our recruitment program.” As to what this means going forward, Mr. Berry added: “While this remains a long term effort, we are encouraged by these results. The survey results help us determine where we need to target our resources to continue to bolster the diversity of FINRA’s neutral roster. DRS is also exploring ways, perhaps through code changes, to improve the chances for new and diverse arbitrators to be selected.”
A Five Year Lookback
We decided to look back to see what’s changed over the last five years. The headlines? The roster has definitely become more diverse, albeit slightly older. We’ve compiled the results in the chart below (ed: numbers in groups will not always total 100%):
| Panel Demographic | Pct in 2021 | Pct in 2017 |
| Male | 66% | 72% |
| Female | 32% | 25% |
| Caucasian | 78% | 84% |
| African-American | 11% | 6% |
| Spanish, Hispanic or Latino | 5% | 4% |
| Asian | 2% | 2% |
| Multi-racial | 3% | 2% |
| American Indian or Alaska Native |
0% | 0% |
| LGBT | 4% | 2% |
| Age 60 or less | 29% | 29% |
| Age 61-69 | 31% | 27% |
| Age 70 or older | 40% | 39% |
FINRA: We’ll Keep at It
The Authority states: “While we are encouraged by these short-term results and incremental progress made, we recognize this is a long-term effort. There is more progress to make and we remain fully committed toward achieving our diversity goals.”
(ed: *Kudos to DRS for making this data public, and an Alert h/t to Mr. Berry for adding his thoughts. **DRS separately surveyed mediators; the results are similar to those for the arbitration panel, although the roster is older – 82 percent of those responding were 61 or older. ***DataStar conducted the 2021 survey. Consulting firm Alight Solutions conducted the surveys from 2017 to 2020. ****The response rate was 32%, down 5% from last year.)
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