July 16, 2021

Pensions & Investments – Investors press companies on DEI

Investor demand for companies to commit to diversity, equity and inclusion was a highlight of the latest proxy season.

One new category this season was proposals asking companies to undergo independent racial equity audits. Of the 20 filed, 12 wound up on ballots and they averaged 30.4% support, “which for a new proposal is quite significant,” said Fassil Michael, head of thought leadership for ISS governance solutions in Rockville, Md. None of the proposals received majority support.

Another indicator of how much companies are listening to investors is when it comes to paying executives. An analysis by Farient Advisors LLC of S&P 500 companies’ compensation disclosures shows corporate boards paying closer attention to DEI when making decisions and setting targets for executive compensation.

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