Vanguard's "Diversity in the workplace" articulates its expectations for portfolio companies on executive, nonexecutive, and overall workforce diversity, equity, and inclusion.
Although not demanding a uniform approach in recognition of jurisdictional, industry, and company-specific differences, Vanguard is looking for boards to ensure and oversee a workforce diversity strategy characterized by a long-term orientation, management accountability, and a culture that promotes equity and talent development and success. Vanguard also expects companies to make progress on their diversity disclosure - specifically, gender, race, and ethnicity at all levels, suggesting SASB and the EEO-1 Report as helpful disclosure frameworks.
Typical engagement questions directors should be prepared to address on this topic include:
- What role does the board play in shaping the company’s culture and workforce?
- What reporting does your company provide on workforce diversity? What improvements or additional workforce disclosure is the company considering?
- Does your company have functions or specific executives responsible for implementing and supporting diversity, equity, and inclusion programs?
- Where in the “life cycle” of an employee do you see your company having the greatest risks or advantages in attracting, developing, and retaining talent?
- Does the board monitor diversity-related risks outside of its immediate workforce, such as in the company’s supply chain?
See this Pensions & Investments article and additional information & resources on our Institutional Investors and Human Capital/Workforce Management pages.
This post first appeared in the weekly Society Alert!