The disclosure of workplace equity data is increasing in its importance to investors and they are letting companies know that this information is material to investment decisions.
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.
One of the issues with regard to disclosing this information is the “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,” according to Equileap, an organization providing data and insights on gender equality.
For example, in 2018, 84% 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% provide evidence on the promotion ratio of women into senior management positions, only 51% release their parental leave policies, and only 1% publish gender-segregated pay information.
“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.”
The benefits of having a diverse workforce have been studied and a small subset of their findings includes:
- Companies with the strongest racial and ethnic diversity are 35% more likely to have financial returns above their industry medians.
- Companies in the top quartile for gender diversity are 21% more likely to outperform on profitability, and 27% 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.
"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,” said. Andrew Behar, CEO of As You Sow, a shareholder advocacy organization that sponsors actions such as this one