Nasdaq Inc Chief Executive Adena Friedman will take on the additional role of board chair, the company said on Monday, executing a playbook similar to that at peers but frowned upon by corporate governance advocates.
The proposed change comes as the exchange operator is pushing for more board diversity. Last year, Nasdaq proposed requiring companies listed on its exchange to publicly disclose the diversity credentials of their boards.
By 2026, companies would also be required to have one director who self-identifies as female and another as an underrepresented minority or LGBTQ+, or explain why they do not have such representation.
Corporate governance experts contend that separating the chairman and CEO roles improves accountability and provides checks and balances in the boardroom. But others argue that splitting the jobs can cause confusion over who is in charge.
Proxy advisory firm ISS declined to comment.
“Adena is incredibly deserving of this appointment. As Nasdaq’s CEO, she has successfully led the company in a new strategic direction,” said current Chair Michael Splinter, who has been named lead independent director for the company.
Friedman will take over the new role on Jan. 1. During her five years as CEO, the company has expanded beyond its traditional exchanges business into software and anti-financial crime technology.
Intercontinental Exchange Inc, CME Group Inc and Cboe Global Markets Inc also have CEOs holding chairperson titles. (Reporting by Niket Nishant and Anirban Chakroborti in Bengaluru; Additional reporting by John McCrank in New York; Editing by Anil D’Silva and Richard Chang)