The event which pushed Covid out of the global news headlines for part of 2020 was the death of George Floyd while in the custody of police. Only one of a series of controversial police actions in the US in recent years, this time the event triggered a global campaign against racism. The Black Lives Matters movement has been revived with knock-on effects for the corporate world. These ongoing reactions demonstrate that in the era of responsible capitalism, corporations are increasingly affected by societal debates.
The corporate world is neither diverse nor inclusive. That data which is available shows that minorities, and more harshly persons of colour, are underrepresented. The further up the hierarchy, the less diverse the corporate population. In some countries, data is completely unavailable due to privacy regulations or other prohibitions.
Most business managers do not know how to address the problem. Large companies want to demonstrate they are supporting persons of colour, and all ethnic minorities, in the fight against racism and discrimination. Reuters reported that within only two weeks of Floyd’s death, corporations had already pledged a total of $1.7bn to address social justice and racism. It is interesting that companies are ready to spend significant amounts to support the cause, but spending is not enough. The key question is how.
Investors are key. Investors have long considered social issues important to the analysis of assets. The current movement tells us that society expects more progress toward the eradication of racism, along with its vicious consequences for social progress -- unequal opportunity at all levels of the social ladder, and a lack of minorities in decision-making roles.
Candriam Responsible Investment Teams are further deepening our analysis of diversity, inclusiveness, and equal opportunity practices for investee companies. We dialogue with companies to share information, helping all to improve our approaches with new ideas. Acknowledging the different regulatory frameworks companies are facing to talk about ethnic diversity, Candriam has been and continues to assess companies’ management commitment to the diversity question, and suggesting a range of actions they can take to improve their inclusion culture.