State Street To Make Further Push for Gender Diversity on Boards
November 13 2017 - 5:26PM
Dow Jones News
By Justin Baer
State Street Global Advisors will begin pushing big Japanese and
Canadian companies to put more women on their boards, an extension
of a shareholder campaign that started this year in the U.S., the
U.K. and Australia.
The index-fund giant, a division of trust bank State Street
Corp., is voting against the re-election of directors charged with
nominating board members if they don't make strides at adding
women. This year State Street found 468 U.S. companies where it was
a shareholder had no women directors. Of those, 400 received "no"
votes on directors.
In 2018, State Street will apply the same test to about 1,200
holdings in Japan and Canada.
State Street chose those countries because of the relatively low
representation women have on boards there. Fifty-five percent of
the companies in Japan's Topix 500 index have no women on their
boards, along with some 40% of those listed on the Toronto Stock
Exchange, according to State Street's calculations. By comparison,
about 25% of the companies in the Russell 3000 index lacked a
single women director earlier this year.
State Street's boardroom diversity campaign, launched in March,
has drawn attention to the dearth of women on corporate boards
while also putting the firm's own diversity policies in the
spotlight.
Its "Fearless Girl" statue, placed near Wall Street's iconic
bull in downtown Manhattan earlier this year, emerged as a popular
symbol for the effort. Then, in October, State Street agreed to pay
$5 million to settle U.S. Department of Labor allegations that it
paid female and black employees less.
State Street President Ron O'Hanley said State Street disagreed
with the methodology Labor officials used to determine pay
imbalances, noting the complaint only covered employees in a single
office in 2010 to 2011. He said the firm has since improved its
record for hiring, developing and promoting women.
In the most recent round of executive promotions, which occurred
earlier this year, 43% were women, he said. That is a higher share
than the firm's overall pool of vice presidents, senior vice
presidents and executive vice presidents, which is roughly 33%
female. In 2016, 45% of all new hires were women.
"This isn't like we turned it around in 2017," Mr. O'Hanley
said. "It's been a steady trend up."
Since the start of State Street's boardroom campaign in the
U.S., 42 companies that received a 'no' vote from State Street have
moved to address the lack of gender diversity, according to Mr.
O'Hanley.
"Some of the votes did catch firms by surprise," Mr. O'Hanley
said. "We were surprised they were surprised. The conversations are
much deeper now."
Write to Justin Baer at justin.baer@wsj.com
(END) Dow Jones Newswires
November 13, 2017 17:11 ET (22:11 GMT)
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