Tapping into a topic of great interest to companies, investors, and regulators, EY's review of Fortune 100 company proxy statements (as of September 5th) revealed noteworthy practices and approaches to disclosure on human capital management and board oversight.
Management initiatives: Half of companies are voluntarily disclosing workplace D&I, and some companies are highlighting specific topics, as shown here and further detailed in EY’s report:
Board oversight: Most companies don’t specify in their proxies how the board structures its oversight of human capital or corporate culture issues. However, companies are volunteering relevant oversight information, including: (i) Many companies (over 40%) disclosed generally that the board oversees HCM or the corporate culture; (ii) Nearly one-third of companies included human capital-related experience among the sought-after skills/expertise for board members; and (iii) 44% cited human capital-related experience as a key qualification in at least one of their director biographies.
The report also identifies several of the established frameworks companies can consider to facilitate their measurement and reporting on human capital matters, including the Embankment Project for Inclusive Capital (EPIC), SASB, GRI, and ISO.
Notably, EY points out that many HCM-related disclosures are captured in company communications outside the proxy – e.g., CSR or sustainability reports or other disclosure vehicles. As such, these findings should not be interpreted as indicative of overall disclosure practices on these topics.
See our recent report: "Proxy Disclosure: CSR, ESG & Human Capital Disclosure Samples Galore!" and access numerous additional resources on our Human Capital/Workforce Management page. This post first appeared in the weekly Society Alert!