EY's “What boards should know about ESG developments in the 2021 proxy season” highlights these and other “hot topic” practices and trends based on the firm’s review of the 79 Fortune 100 companies that filed proxy statements as of June 22.
Board E&S / CSR Oversight
Of the 85% of companies disclosing board committee oversight of E&S or CSR matters (compared to 78% last year), most allocate this responsibility to the Nominating/Governance Committee, as shown here:
Human capital and workforce diversity matters are most commonly overseen by the Compensation Committee for those 70% of companies that disclosed committee oversight (compared to 44% last year), as shown here:
Board Diversity Disclosure
86% of companies (compared to 54% in 2020) voluntarily disclosed the board's racial/ethnic diversity based on directors' self-identification, which EY notes some directors may opt out of for personal reasons. Of those, 29% disclose the fact of racial/ethnic diversity at the individual director level, often in matrix form, and 15% identify the specific race or ethnicity of individual directors.
Climate & Workforce Diversity Disclosure
There was a substantial increase year-over-year in the number of companies that disclosed climate-related and workforce diversity-related information, as shown here:
The report includes key takeaways for the board and management that home in on how companies can evolve their disclosures to keep pace with changing investor expectations and priorities and other macro developments.
See EY’s online version with infographics here; these articles from ESG Today and CFO Dive; and additional information & resources on our Proxy Season 2021 page.
This post first appeared in the weekly Society Alert!