Assess Company Diversity and Inclusion Efforts

Resolution Text

RESOLVED:  Shareholders request that The Walt Disney Company (“Disney”) publish annually a report assessing Disney's diversity, equity, and inclusion (DEI) efforts, at reasonable expense and excluding proprietary information.  The report should include:

  • the Board’s process for assessing the effectiveness of its diversity, equity, and inclusion programs, and
  • 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.

WHEREAS: Investors seek quantitative, comparable data to understand the effectiveness of Disney’s DEI programs.

Numerous studies have pointed to the corporate benefits of a diverse workforce. These include:

  • 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.[1]
  • The 20 most diverse S&P 500 companies had an average annual five-year stock return that was 5.8% higher than the 20 least-diverse companies.[2]
  • FTSE 350 companies with 33% female representation on their executive committees had a net profit margin more than 10 times greater than companies without women on their executive teams. (15.2% versus 1.5%)[3]

Yet, significant barriers exist for diverse employees advancing within their careers. Women enter the workforce in almost equal numbers as men (48%). However, they only comprise 22% of the executive suite. Similarly, people of color comprise 33% of entry level workers, but only 13% of the c-suite.[4]

Disney’s 2019 Corporate Social Responsibility Update states, “At Disney, our talent recruiting, retention, and development efforts prioritize the cultivation of a strong, diverse, and thriving workforce, with 44% of our U.S. employees identifying as people of color. We are committed to providing safe, respectful, and inclusive workplaces . . .”

However, Disney has not released meaningful information that allows investors to determine the effectiveness of its workplace diversity programs.  Stakeholders may become concerned that Disney’s statements are corporate puffery, language described by the United States Federal Trade Commission as marketing exaggerations intended to “puff up” products and not able to be relied upon by consumers and investors.

Investors have reason to be wary, as Disney has faced allegations of sexual harassment, discrimination, and abuse within its theme parks, entertainment production, and leadership.    

Investor desire for information on this issue is significant. As of August 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.[5]

 

 

[1]McKinsey & Company, “Delivering through Diversity”, January 2018 (https://www.mckinsey.com/~/media/mckinsey/business%20functions/organization/our%20insights/delivering%20through%20diversity/delivering-through-diversity_full-report.ashx)

[2] Holger, Dieter, “The business case for more diversity” Wall Street Journal, October 26, 2019 (https://www.wsj.com/articles/the-business-case-for-more-diversity-11572091200)

[3] https://www.execpipeline.com/wp-content/uploads/2020/07/The-Pipeline-Women-Count-2020-FINAL-VERSION.pdf

[4] McKinsey & Company, “Women in the Workplace 2018”, (https://womenintheworkplace.com/)

[5] https://www.asyousow.org/our-work/gender-workplace-equity-disclosure-statement

Lead Filer

Laura Campos
Nathan Cummings Foundation