CHAPTER 07 Beyond Gender: Diversity and Inclusiveness Now and Going Forward
In Focus: Systemic Racism and Discrimination
– Canadian Council of Business Leaders Against Anti-Black Systemic Racism. This new organization was launched in June 2020 by a group of high-profile Bay Street executives and is committed to removing anti-Black systemic barriers affecting the lives of Black Canadians. It hopes to increase the representation of Black people in Canadian boardrooms and executive offices, while also ensuring that companies follow through on their statements and take active steps to support Black employees and the Black community more broadly. 141 See “Canadian Council of Business Leaders Against Anti-Black Systemic Racism and the BlackNorth Initiative,” below, for further discussion. – Goldman Sachs’ updated IPO policy. Effective July 1, 2020, Goldman Sachs implemented a new policy stipulating that it will not take a company public in the United States or Europe unless the company has at least one diverse director from an under-represented group. Individuals affected by gender identity, sexual orientation, race or ethnicity are considered diverse. Starting in 2021, Goldman Sachs will raise the requirement to two diverse directors. Goldman Sachs noted that the decision was driven by two main factors: (1) U.S. issuers that have gone public with at least one female director outperformed those without any female directors; and (2) changing the stereotypes associated with corporate decision-making will have many positive effects for society. Goldman Sachs’ policy is expected to be impactful, given that it is one of the pre-eminent underwriters of IPOs globally. 142
MAJOR DEVELOPMENTS IN 2020 The tragic death of George Floyd and ensuing protests for racial justice have brought issues of diversity, systemic racism and discrimination to the forefront of discussions in the corporate world. Prominent business leaders in Canada have become particularly active in trying to build on the growing momentum with respect to diversity issues. In recent months, many companies have responded with statements decrying the current state of affairs and have announced significant financial commitments to diversity initiatives. Large institutional investors have been speaking out and considering action relating to their portfolio companies. In the United States, we are starting to witness diversity-related lawsuits, including lawsuits against Oracle Corporation, Facebook, Inc. and certain of their directors and officers. These lawsuits are based on their alleged failure to uphold commitments to diversity, the lack of racial diversity on their boards and misrepresentations about their commitments to diversity in light of their public disclosure regarding the overall level of diversity of their workforces, boards and executive teams. Some directors and officers at Oracle and Facebook are also alleged to have violated their fiduciary duties by their inaction on diversity issues and their acceptance of racially discriminatory practices in the workforce. 140 The following other notable examples of business- related diversity initiatives and actions in recent months suggest that diversity based on a broader range of criteria will continue to remain under focus in the coming years.
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