On the heels of the new Regulation S-K human capital disclosure topic and intensified focus on workforce and board diversity and inclusion, Morrison & Foerster's "Recent Changes in Human Capital and D+I for Public Companies" provides timely tips and guidance to assist companies in developing or enhancing their disclosure and preparing for shareholder engagement on the human capital issues that are most relevant to their business.
In addition to providing an overview of the new human capital resources disclosure requirements and state-level board diversity initiatives, the instructive memo:
- Offers examples of human capital management processes, initiatives, metrics, and risks companies may wish to consider, categorized by Human Resources, Compensation & Benefits, Risk Management, and Governance
- Explains how "diversity" and "inclusion" differ, and why diversity alone won't suffice
- Notes the importance of past HCM disclosures for their precedential value
- Advises companies that have not already done so to establish a strategy or approach to comply with the new SEC requirements and investors' expectations that includes (among other things) rigorous review of potential disclosures on par with other SEC disclosures and board oversight
See also the list of thought-provoking disclosure-related questions and considerations set forth in Willis Towers Watson's "Companies must assess materiality of human capital under final SEC rules"; Deloitte's "The Inclusion Imperative: How Boards Can Encourage Belonging" (NACD Directorship); and additional resources on our Disclosure Reform page » Regulation S-K Items 101, 103, 105 and on our Human Capital/Workforce Management page. This post first appeared in the weekly Society Alert!