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Ninety-nine investors representing more than $1.61 trillion in assets under management are asking companies to increase public access to information related to workplace equity policies and practices across gender, race, ethnicity, sexual orientation, and other diversity types. Investors believe that these disclosures are material, meaning that they have significant impact on investing decisions and they create the ability to compare company cultures and risk. Unsuccessful or poorly implemented workplace equity programs may harm long-term shareholder value.
“This is a defining moment for companies to take a stand and demonstrate to the world the core of their culture and conviction on equality,” Andrew Behar, CEO of As You Sow, said. “This is a material issue for every company. Leaders willing to publicly disclose their policies and practices on gender, race, and sexual orientation will be the companies that succeed by attracting and retaining the best and the brightest employees, and reducing risk to benefit shareholders.”
Numerous studies have pointed to the many benefits of a diverse workforce. A small subset of their findings include: Companies with the strongest racial and ethnic diversity are 35 percent more likely to have financial returns above their industry medians. Companies in the top quartile for gender diversity are 21 percent more likely to outperform on profitability, and 27 percent more likely to have superior value creation. Seventy-nine percent of board directors believe that diversity enhances board performance, and more than half believe it enhances company performance. Business teams outperform on sales and profits when their gender mix is equal.
According to Equileap, a leading organization providing data and insights on gender equality, there is a significant divergence between the public commitments companies make to workplace equality and the disclosures they provide to investors showing how, and if, they are meeting their stated goals. For example, in 2018, 84 percent of the S&P100 made public commitments to gender equality policy statements related to recruitment, career development, and workplace safety. However, of the S&P100, only 64 percent provide evidence on the promotion ratio of women into senior management positions, only 51 percent release their parental leave policies, and only 1 percent publish gender-segregated pay information. Investors are concerned that companies are willing to make promises regarding workplace equity, but unwilling to provide corroborating data.
“We can only improve what we can measure,” Diana van Maasdijk, CEO of Equileap, said. “One of the biggest obstacles to accelerating workplace equity is the lack of transparency from many companies, including on their practices to close the gender pay gap, to provide paid parental leave to both parents, or to recruit without discrimination. That's why we collect data on more than 3,000 companies on gender equality on 19 criteria and we regularly publish our key findings. I am pleased to see so many investors voicing their support for gender equality and hope this is just the beginning of a new wave of pressure towards increased transparency and progress.”
New investor signatories are still being accepted.
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As You Sow is a nonprofit organization that promotes environmental and social corporate responsibility through shareholder advocacy, coalition building, and innovative legal strategies. Click here to see As You Sow’s shareholder resolution tracker.
Equileap is the leading organisation providing data and insights on gender equality in the corporate sector. Headquartered in Amsterdam and London, the organisation aims to accelerate progress towards gender equality in the workplace, using the power of investments, grants and knowledge.
Stefanie Spear As You Sow 216-387-1609 firstname.lastname@example.org