- EOS engagement contributed to the company’s understanding of best practice human capital management, leading to improved disclosure.
- We continue to follow up with the company on the mechanism developed to ensure continuous improvement on talent management and progress the company is making.
- We will encourage the company to continue to make annual disclosures so that year-on-year improvements can be demonstrated.
EOS has been engaging with Baidu on human capital management since 2016. Our engagement began in the context of changing the company’s culture to improve its search platform for ethical advertising.
A chief operating officer was appointed in 2016 to oversee the company’s AI vision. In March 2017, we were therefore able to discuss human capital management in relation to incentivising and managing performance for AI applications.
In May 2019, we intensified our engagement on this issue. We also communicated our concerns about the accelerated outflow of Baidu’s technology talent, which was deemed the worst among technology companies in China, heightened by increasing competition not only from within the technology industry but also from banks seeking to build digital solutions.
Baidu said this phenomenon is not new in the Chinese technology sector and the company’s attrition rate was not higher than historical levels. On senior management turnover, Baidu said it was part of the natural talent review process. We urged the company to disclose relevant human capital management indicators and its efforts around talent retention.
In 2020, the company established an ESG committee and we welcomed the company’s commitment to publishing an ESG report on an annual basis instead of every three years. The company made a deliberate commitment to diversity and inclusion and took up our suggestions to include workforce statistics.
Finally, in March 2021, the company released its first special report on human capital management in addition to the 2020 ESG report. We will follow up with the company on the mechanism developed to ensure continuous improvement on talent management and progress the company is making.