New Jersey and its bonding entities will begin assessing how often women- and minority-owned underwriters serve as book-running managers on debt transactions after a bill requiring such reports became law last week.
The state Treasury Department and bonding authorities and corporations will now compile annual reports for the treasurer.
The assessments will include the number of times qualified women- and minority-owned investment banks served as senior managers on deals, how often they unsuccessfully bid for lead managing positions, compensation levels, and other details.
The Treasury Department will review the reports. If it determines that there is a lack of women- and minority-owned firms as underwriters, the treasurer is required to set utilization and compensation goals.
“This law is very important, as the state seems to have a history of excluding qualified minorities and women as managers of bond issues,” Sen. Ronald Rice, D-Essex, said in a statement. “With this law, we are working to ensure that minority-owned businesses have the chance to fully manage and put bond deals together, and have the same opportunities as other businesses to reap the benefits that these deals can yield.”
The New Jersey law follows a similar initiative in New York. That state and many of its bonding agencies have implemented procurement changes in order to increase participation of women-owned and minority-owned firms in senior-managing positions.
Former New York Gov. David Paterson pushed for the changes after a special task force concluded that such firms were underrepresented among the state’s bond deals.