American Express: Greater Disclosure of Material Corporate Diversity, Equity and Inclusion Data
BE IT RESOLVED: Shareholders request that American Express Company (American Express) publish annually a report assessing the Company's diversity and inclusion efforts, at reasonable expense and excluding proprietary information. At a minimum the report should include:
the process that the Board follows for assessing the effectiveness of its diversity, equity and inclusion programs,
the Board’s assessment of program effectiveness, as reflected in any goals, metrics, and trends related to its promotion, recruitment, and retention of protected classes of employees.
SUPPORTING STATEMENT: Investors seek quantitative, comparable data to understand the effectiveness of the company’s diversity, equity, and inclusion programs.
WHEREAS: Numerous studies have pointed to the corporate benefits of a diverse workforce. These 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.
A 2019 study of the S&P 500 by the Wall Street Journal found that the 20 most diverse companies had an average annual five year stock return that was 5.8 percent higher than the 20 least-diverse companies.
Despite such benefits, significant barriers exist for diverse employees advancing within their careers. Women enter the workforce in almost equal numbers as men (48 percent). However, women comprise only 22 percent of the executive suite. Similarly, people of color comprise 33 percent of entry level positions, but only 13 percent of the c-suite.
The American Express 2019-2020 Environmental, Social and Governance Report states “Our senior executives take responsibility for delivering on our commitments and ensuring diverse representation at all levels. Our Company scorecard, which is used to measure our performance and progress on our business priorities, includes a clear set of diversity goals and overall talent metrics. We set our scorecard metrics annually and review our progress against them regularly to hold ourselves accountable.”
This scorecard is not published. American Express has not released meaningful information that allows investors to determine the effectiveness of its human capital management programs related to workplace diversity. Stakeholders may become concerned that American Express’ statements are corporate puffery, language described by the United States Federal Trade Commission as marketing exaggerations intended to “puff up” companies or products and not able to be relied upon by consumers and investors.
Investor desire for information on this issue is significant. As of October, 2020, $1.9 trillion in represented assets released an Investor Statement on the importance of increased corporate transparency on workplace equity data. It stated:
It is essential that investors have access to the most up-to-date and accurate information related to diverse workplace policies, practices, and outcomes.
Resolution Details
Company:
American Express
Co-lead Filers:
As You Sow
Year: 2021
Filing Date:
November 2020
Initiative(s): Diversity Data Disclosure
Status: 59.7%