This metric is intended to capture if the organization was founded by an individual (or a majority group of individuals) who belonged to an underrepresented group (i.e., a racial or ethnic minority within a given country’s context) and who retained an active role in the organization as of the end of the reporting period.
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The categorization of underrepresented groups varies with location and context. With no internationally agreed-upon definition as to which groups constitute underrepresented on the basis of race and/or ethnicity, if well-established national or local policies exist, organizations should refer to these local guidelines to identify groups underrepresented on the basis of race and/or ethnicity.
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If the organization had multiple founders, the organization should only consider itself founded by underrepresented individuals if the majority of the founders belonged to underrepresented groups and retained active roles.
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An active role can refer to a key position in the organization’s senior leadership team (C-suite or equivalent). It may also include acting in an advisory capacity for key decisions and does not necessarily require a full-time role at the organization.
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Example 1: An entrepreneur from an underrepresented group founded the organization, and has since launched other projects and now only engages with the company every month for big meetings and strategic planning. As they are still key to the organization's strategic direction, this would still count as playing an active role.
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Example 2: An entrepreneur from an underrepresented group started an organization but has since sold their majority stake to a private equity firm. They stepped back as CEO, and is seen as an expert voice on key topics relevant to the company’s decision-making process. However, they engage irregularly, when requested by the Board rather than at set times, and their advice is sometimes disregarded when considering long-term strategic advice. This would not count as playing an active role.
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Example 3: An organization was legally registered in 2010 with equal ownership between two individuals NOT from underrepresented groups and one individual from an underrepresented group. All three still have significant company roles. This would not count as an organization founded by underrepresented individuals.