George Floyd’s assassination sparked a wave of promises from corporate America to advance racial fairness. Almost a year later, big American corporations are under pressure to show progress in delivering on those promises.
Shareholders will vote in the coming weeks on some of these initiatives, including whether Walmart should report on the fairness of its pay scale and whether Facebook and Google / Alphabet should appoint a civil rights specialist to their boards of directors.
Another frequently offered option is a racial equity audit that compares a company’s record with statements made in its glossy marketing materials.
The promoters characterize this report as a risk management tool that can help protect brands.
âThere are a good number of shareholders who recognize that this is an issue that could cause reputational damage at a significant level,â said Tejal Patel, director of corporate governance at CtW Investment Group, a group of activists who organized the campaign in several large companies. .
The proposals calling for a racial equity audit have garnered support from around 30% or more of shareholders at several large companies, including Citigroup, JPMorgan Chase, Goldman Sachs and Johnson & Johnson. And later this month, Amazon shareholders will assess a similar audit plan.
“It’s a work in progress,” said Olivia Knight, head of racial justice at As You Sow, another advocacy group that has been active on proposals to address racial justice and diversity, fairness. and inclusion or DEI.
– ‘Bank deserts’ –
The current push by activists is a response to the events of last spring, when the police murders of Floyd, Breonna Taylor and other African Americans sparked mass protests and national recognition of racial justice.
In the wake of this uprising, big companies were quick to release statements supporting Black Lives Matter and promising to do more to listen to non-white consumers, employees and communities.
Campaigners have greeted these promises with a bit of skepticism, in part because of the lack of progress by American companies in promoting diversity at the highest levels. The largest American companies are still predominantly run by white men.
Late last year, the CtW and the International Union of Service Employees (SEIU) drafted resolutions calling for racial equity audits in eight major financial groups, several of which have settled investigations involving millions of people. governments on lending discrimination in recent years.
Big traditional banks also have a reputation for avoiding inner-city neighborhoods, creating âbanking desertsâ that will force residents to turn to predatory lenders.
The resolutions called for a resumption of company operations, including lending practices and political contributions, which would be prepared in consultation with civil rights experts and made public.
“I think if there was someone peeking inside it would be more transparent,” said Toni Smith, who said her New Orleans branch of Chase Bank discouraged her when she needed a car loan and a loan for professional equipment.
Smith, who works in home health care and cosmetology, is struggling to pay off lenders who have charged interest rates above 20%. She told AFP she was considering filing for bankruptcy.
âIf we’re not sitting on the money, you don’t get the opportunities,â she said. “We cannot progress.”
The challenges black Americans have faced in creating wealth over generations due to lack of access to credit and racially motivated restrictions on where they can buy housing have been another focus of the movements. racial justice.
– Independent once –
Models for the audit include reviews similar to those already undertaken at Facebook, Starbucks and other companies, said Patel, who stressed that the oversight should be independent of management.
Facebook’s audit, written by civil liberties lawyer Laura Murphy and civil rights law firm Relman Colfax, praised the social media giant’s efforts to fight voter suppression and some other measures, but called other measures “serious setbacks for civil rights”.
They also said the platform should have withdrawn statements by former President Donald Trump that they said encouraged violence against civil rights protesters.
CtW withdrew a proposal from Morgan Stanley after the investment bank accepted an independent review of its talent program. Sponsors also dropped a campaign at BlackRock after the asset management company agreed to commission an audit.
Six other companies chose to fight the resolutions, citing major philanthropic and commercial announcements about racial equity.
In October, JPMorgan announced a $ 30 billion push to advance racial equity, which includes pledges of 40,000 home purchase loans for black and Latin households, opening new branches of community centers in underserved communities and public progress reports.
But the CtW proposal hinted at the bank’s “conflicting history” over race, including a $ 55 million settlement in a US mortgage discrimination lawsuit, the bank’s deployment of a program. US small business aid that disproportionately benefited predominantly white areas and police donations. foundations in New York and New Orleans.
“We believe we are taking the appropriate steps to address the issues raised in the proposal,” JPMorgan said in response to the measure. “Performing a racial equity audit at this point would not provide us with any useful additional information.”
At Tuesday’s annual meeting, JPMorgan CEO Jamie Dimon said promoting racial equity was “complex and we are committed to getting it right.”
Moments later, bank officials announced that CtW’s proposal had garnered 39% of the vote.
jmb / hs