The recent decision by the ASX Corporate Governance Council to shelve proposed diversity reporting changes confirms a significant shift in the conversation around corporate governance. The proposed rules aimed to extend diversity disclosure to include characteristics like sexuality, age, heritage, and disability. But the intense pushback that led to their rejection highlights a crucial, often overlooked aspect of Diversity, Equity, and Inclusion (DEI) – the importance of privacy.

The decision to abandon these proposals stems from a fundamental divide between corporate stakeholders and external calls for greater transparency and inclusion. Organisations representing privacy and business interests rejected the notion that listed companies should disclose personal characteristics about their leadership, because of fears about potential discrimination or stigmatisation. Privacy, in this context, isn't merely an issue of confidentiality; it directly intersects with the broader, more complex issues of equity and individual autonomy.

This issue is not just about corporate governance, but also about sustainability in a more holistic sense. When we talk about material sustainability topics, particularly environmental and social sustainability, we must consider how corporate policies impact human rights and societal wellbeing. DEI initiatives must be sensitive to the personal nature of the information being asked for. The morale of a workforce hinges on creating environments where individuals feel safe, respected, and free from exposure that could harm their professional or personal lives. Mandating personal disclosures without proper safeguards could undermine the trust and inclusivity that many DEI initiatives aim to foster.

While some argue that increasing transparency around diversity can drive progress, the sensitivity of the data being requested cannot be ignored. The failure to find a compromise on the ASX proposals exemplifies the challenge of balancing corporate transparency with personal rights, and that efforts to improve representation do not inadvertently harm individuals or groups.

In the context of material sustainability topics, should privacy considerations become a critical part of the conversation? Sustainable practices should not only focus on tangible assets like energy consumption or waste reduction but also on creating a sustainable social and organisational environment. This requires a careful and respectful approach to the sharing of personal information.

Further, the question of privacy in understanding social outcomes is not new, especially in philanthropic and government programs. Conversations around human research ethics have long been central in these domains, particularly when personal data is collected to assess the effectiveness of social initiatives. Similarly, as companies gather employees' data to inform corporate social programs, they must engage in the same ethical considerations. This includes obtaining informed consent, ensuring data security, and being transparent about how personal information will be used.

Ultimately, DEI efforts should contribute to a more sustainable future, not just through environmental initiatives but by fostering inclusive, ethical, and respectful corporate cultures. For that to happen, privacy must remain a cornerstone of how diversity data is gathered and shared, ensuring that the move toward greater inclusivity does not come at the expense of personal security or autonomy. In this way, the conversation around DEI can evolve in a way that supports both individuals and organisations, paving the way for more thoughtful, sustainable practices in the business world.

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