Carlos Orta: Building strong independent Boards requires diversity

Having greater diversity – including more Latinos – in corporate Boardrooms creates strong, independent Boards of Directors to the benefit of shareholders.

Businesses gain a competitive edge with greater emphasis on a diversity of views, ideas and perspectives. Well-functioning, diverse Boards lead to strong financial results, maintaining institutional experience and better company decision-making.

Today, Latino representation on corporate Boards is dismal at just below 5%, according to the U.S. Census.

The percentage equates to 275 Board seats out of an estimated 5,500 on Fortune 500 company Boards.

Latinos have grown to almost 20% of the U.S. population in 2024, making them the largest minority group in the U.S. And U.S. Latino buying power reached $3.2 trillion in 2021, making the group the fifth largest economy in the world, ahead of the United Kingdom, India and France.

Yet, Board representation for Latinos remains woefully low. Other minority groups like African Americans and Asian American and Pacific Islanders are much more fairly represented in Boardrooms proportional to their populations at large.

Groups like The Latino Corporate Directors Association are working to bring greater Latino representation to corporate Boards by identifying Latino talent to serve as a conduit to fill future Board positions with Latinos.

But corporations have an equally important role to play nominating qualified Board candidates who are of Hispanic heritage as well as identifying talent, developing that talent, and preparing talent for Board seats.

A major proxy adviser – Glass Lewis – introduced guidelines for underrepresented community diversity, stating that for Russell 1000 companies, Glass Lewis “will recommend voting against the chair of the nominating committee if the Board has no directors from an underrepresented community.

While this is stated, Glass Lewis has not adhered to it in practice. Rather, it’s done the opposite and is actively working against Latino representation. Glass Lewis and another major proxy adviser – ISS – this year issued formal reports recommending that shareholders vote against a highly qualified Hispanic Board nominee at Masimo, a leading med-tech company.

Masimo has nominated two diverse candidates to the Board. Up for re-election is its CEO, founder, and Chair, Joe Kiani, an Iranian-born American engineer who founded the company in 1989. Also nominated is Christopher Chavez, who has over 30 years of experience in the medical device industry and has twice served as CEO of a public company. That’s in addition to his experience serving as an independent public company director.

The other slate that shareholders have for consideration – and Glass Lewis has recommended – comes from Politan Capital Management, an activist hedge fund founded just three years ago, attempting to unseat Masimo’s CEO and founder and thereby win a majority of the Board.

Politan already has two seats; an additional two would give the unproven firm control of the successful company.

Unlike Chavez, Politan’s nominees lack diversity and experience in the med-tech industry, a vital qualification. Companies like Masimo require vision and innovation to continue success, and an experienced industry leader is ideal for the company’s Board. There will not be an improvement in Hispanic representation on corporate Boards until more companies like Masimo nominate qualified candidates like Chavez and shareholders vote them onto the Board.

The Latino Coalition urges Glass Lewis to follow its own guidelines and reverse its hypocritical position. Glass Lewis and other proxy advisers should support the election of Chavez and Kiani to the Masimo Board of Directors.

Shareholders should recognize the qualifications of strong nominees like Chavez, who bring experience to support Masimo’s business momentum and increasing diverse representation.

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Carlos Orta is president and CEO of The Latino Coalition.

The Latino Coalition (TLC) is the leading advocacy and membership organization for U.S. Hispanic businesses. We are a pro-free-market, bipartisan, national Hispanic business association with the goal of ensuring every Hispanic American who wants to start and grow a business has the opportunity and the right economic environment to do so. In 2025, TLC celebrates its 30th anniversary.