NYC Comptroller Seeks Public Disclosure of EEO-1 Reports: Shareholder Proposals Expected for 2021 Annual Meetings - Also Reports on its “Rooney Rule” Initiative

Weil, Gotshal & Manges LLP

The Office of New York City Comptroller (the NYC Comptroller) on behalf of three of the New York City Retirement Systems (NYCRS) has sent a letter to the CEOs of 67 S&P 100 companies calling on them to match their companies’ recent statements in support of racial equality and diversity with concrete action by providing transparency into – and thereby enhancing their accountability for – the composition their own workforce. Specifically, the NYC Comptroller is asking these companies to adopt a policy to publicly disclose their annual Consolidated EEO-1 Reports, which reflect the race, ethnicity and gender of their employees, with oversight to be provided by independent members of the board. The NYC Comptroller requested recipients of the letter to commit in writing by August 30, 2020 to publicly disclose their EEO-1 Report when they submit their next Report in 2021. If companies are unresponsive to the request, the NYC Comptroller indicated that it may submit a shareholder proposal or factor such unresponsiveness in evaluating director nominees standing for re-election at the company’s next annual meeting...

In addition, as we previously discussed... in October 2019, the NYC Comptroller sent a letter to 56 S&P 500 companies requesting that they adopt a diversity search policy akin to the “Rooney Rule” -- a policy of the National Football League (NFL) that requires football teams to, among other things, interview minority candidates for head coach, general manager jobs and equivalent front office positions. The policy sought by the NYC Comptroller would require the initial lists of management-supported director nominees and CEO candidates to include qualified female and racially or ethnically diverse candidates from non-traditional fields, such as government, academia and not-for-profit sectors.

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