We always welcome comments on current items of interest, and we really like it when a Letter to the Editor elicits a response. We published in SAA 2022-46 (Dec. 8) a letter from arbitration practitioner – and SAA Editorial Advisory Board Member – William D. Nelson, Esq., opining on FINRA’s arbitrator and mediator panel demographics. At the Alert’s request, this prompted a response from FINRA in the form of a letter from Dispute Resolution Services’ Associate Director, Recruitment and Training, Nicole Haynes. Headers were added by us:

Haynes: FINRA Dispute Resolution Services was recently asked to respond to William D. Nelson’s comments about FINRA’s arbitrator roster in Denver, Colorado. FINRA strives to provide a fair, efficient and effective forum for the resolution of securities disputes. FINRA is committed to providing a well-qualified and diverse slate of neutrals to resolve these disputes and has broadened and expanded the depth and diversity of the arbitrator roster. FINRA has engaged in aggressive recruitment campaigns to increase the number of neutrals that are available to hear cases. From attending in-person conferences nationwide, to hosting regional events, to targeted digital advertising and most recently advertising on National Public Radio, FINRA has invested significant resources and cast an extremely wide net to recruit new arbitrators to join the forum. As a result, the number of arbitrators in the FINRA pool, including in Denver, has increased significantly over the years.

Demographic Survey

Each year, using an external vendor, FINRA conducts a voluntary, confidential and anonymous demographic survey of its arbitrator population. The survey results are published on FINRA’s website – we provide overall arbitrator roster data as well as information regarding the newly added arbitrators each year. The results of the 2022 arbitrator demographic survey demonstrate that FINRA continues to make progress on the diversity front, particularly with respect to gender.

Recruitment Results

To truly illustrate the results of FINRA’s recruitment efforts, highlighted below is a comparison of the newly added diverse arbitrators who joined the roster in 2015 and 2022.

FINRA has seen a huge increase in the number of applications that we receive each year, as well as an increase in the diversity of FINRA’s arbitrator roster. Notwithstanding this success, our efforts to further diversify the arbitrator roster is ongoing. FINRA will continue to aggressively recruit new arbitrators and continue to devise innovative strategies to expand the reach of our recruitment efforts in order to meet the needs of our constituents.

Changes Coming to the Arbitrator Listing Process

In addition to current recruitment efforts to bolster the forum’s neutral roster, in 2023, FINRA will propose changes to the arbitrator selection process to provide new and more diverse public arbitrators with greater opportunities to serve. Currently, public chairpersons have two opportunities to appear on a list. Chairpersons not appointed to the chairperson list also appear in the public arbitrator pool along with the public arbitrators in each hearing location for possible inclusion on the list, thereby giving eligible public chairpersons an advantage. To correct this imbalance, the proposal would provide non-chair qualified public arbitrators with two opportunities to appear on the public list. Chair-qualified arbitrators would have one opportunity to appear on the public list, as they already had one opportunity to be selected on the chairperson list. The goal of the proposal is to provide new and more diverse public arbitrators with greater opportunities to serve, to gain experience and ultimately become eligible to join the chairperson roster.

Conclusion

FINRA remains fully committed to its goal of achieving diversity on the arbitrator roster and will continue its efforts to provide a robust and diverse slate of arbitrator candidates. To aid us with our efforts to achieve panel diversity, FINRA encourages parties to consider the value of diversity and the role that their selections play in fostering inclusion in the dispute resolution community. 

Nicole Haynes

FINRA Dispute Resolution Services

Associate Director, Recruitment and Training

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SAA: We’re delighted to have touched off this dialogue, and perhaps to have prompted release of the demographics stats update. The recruitment results are indeed impressive, but we would have liked to see discussion addressing Mr. Nelson’s observations about age imbalance in the roster