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International Women’s Day 2024

engaging with companies on gender equality issues

11 March 2024
Below our engagers outline how they have been working with companies to address gender equality in the workplace

International Women’s Day is an important reminder that gender equity as part of a Diversity Equity and Inclusion strategy is essential for organisations to perform at their highest levels. Enhancing diversity reduces the risk of group think and unintentional biases, which we believe should benefit company performance over the long term. It also supports wider social inclusion benefits, which can help to reduce social strains, protect the wider economy and enhance portfolio-level returns.

As a central component to our engagement programme and a key focus for 2024, addressing gender equity in the workplace involves the consideration of a variety of human capital and governance factors which should be addressed in tandem.

In 2024 to enhance the quality of board performance, which is foundational to good corporate decision-making, our stewardship teams will continue to seek to improve board cognitive diversity to more effectively oversee strategy and complex stakeholder issues while reducing the risk of group think. We are also continuing our focus on diversity, equity and inclusion; asking companies to develop a strategy and action plan to close the pay gap and achieve proportionate ethnic and gender representation at all levels.

Companies that strive to nurture and retain their workforces by developing inclusive and safe cultures, alongside parental leave, paid sick leave and menopause support, are likely to reap the benefits with happy, productive employees.

Here we outline how our stewardship teams have been working with companies to target these issues:


Velika Talyarkhan, Director – Engagement, EOS at Federated Hermes Limited: Netflix

In 2018 Netflix lacked disclosure and targets for diverse representation, and we were concerned that this prominent entertainment services company was not effectively managing these risks.

We first engaged Netflix in 2018 through a collaborative investor letter. Following a withdrawn 2019 shareholder proposal asking for material disclosure on material environmental, social and governance considerations, we shared detailed expectations for the company to provide greater disclosure on their setting of targets for a more diverse and inclusive workplace; the intention being to increase colleague morale, sense of belonging and as a result productivity and better turnover.

We continued our discussions with the company in 2021. Whilst, they expressed a strong commitment to transparency and diversity and inclusion in their workforce and content, they did not however appear proactive in addressing our request to set diverse representation goals.

The company’s first inclusion report was then published in early 2021, which disclosed workforce representation data, showing trends of improved global gender and US racial/ethnicity representation. The report also outlined and described the company’s efforts to create a diverse and inclusive culture, including plans to increase its gender representation.

Netflix is clear that it has more work to do and wants to focus on Hispanic or Latinx and Indigenous Peoples, representation outside of the US, and measuring “inclusion health” – or the employee experience.

Judi Tseng , Associate - Engagement, EOS at Federated Hermes Limited - Delta Electronics: Techtronic Industries

Our engagement team have been in dialogue with Techtronic Industries since 2020 on a number of long term sustainability related issues. With the objective of increase employee morale, wellbeing and productivity, this includes issues such as maternity leave and workforce diversity under our human capital management theme, and the makeup of their board of directors, under governance.

As such, we engaged with Techtronic on setting targets for gender and racial diversity and reviewing its policies and processes including training and development to support positive change. The company was governed by an all-male board, coupled with committee independence issues, so we engaged with the hope of changing this.

Over the following two years, the company demonstrated significant improvement in its metrics reporting, which included gender diversity of overall workforce and managerial positions, and return rate after parental leave. It later provided comprehensive disclosure on human capital management, covering diversity and inclusion, talent attraction and engagement, benefits and training, accompanied by a commitment to have all of its employees trained in diversity and inclusion. We also saw improvements in board gender diversity from an all-male board in 2020 to having two female directors in 2022.

We continue to engage on this topic with the company alongside other governance issues, seeking to understand how its board composition is reflective of the diversity of the stakeholders it has identified.

Pauline Lecoursonnois, Engagement, EOS at Federated Hermes Limited: Novartis

Our team have been in dialogue with Novartis on a range of relevant and material sustainability topics since 2009.

Ahead of the 2018 annual shareholder meeting, our concerns had risen about insufficient progress made on gender diversity at the board level, despite engagement on this issue. In Switzerland, we expect at least 30% of the board to be women but Novartis has achieved just 25%. Whilst recognising that every business context is different, our challenge to the board was that without a credible rationale, underrepresentation of women on the board was unlikely to be optimising the board’s productivity and governance. We therefore informed the company of our intention to recommend a vote against the re-election of the nominations committee chair, maintaining our vote recommendation at the 2019 shareholder meeting as no further progress had been made.

In 2020, following our multiple calls for greater gender diversity on the board, the company announced an aspiration to find female candidates for two of the next three board nominations. One woman had already been nominated for election to the board which would therefore comprise four out of 14, bringing the proportion to 29%. In December 2020, we had a video call with the vice chair who assured us that a smooth and orderly transition will ensure there is an appropriate level of gender diversity on the board.
The company’s 2024 annual report indicates that Novartis is focused on achieving even greater diversity when identifying new board member candidates, which they have pledged to continuously advance efforts to promote gender parity in the composition of its board of directors. This gives us confidence in its aims to further increase the number of women on the board, in line with our engagement.

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