- State Street Global Advisors, a huge asset manager, called for the companies it invests in to improve their gender diversity — or else face a vote against them.
- The call came as part of State Street’s instalment of “Fearless Girl,” a statue of a defiant girl in front of downtown Manhattan’s Wall Street bull.
- State Street has since followed through on its promise, voting against 400 companies that failed to act.
The $US2.6 trillion asset manager behind the”Fearless Girl” statue is putting its money where its mouth is.
State Street Global Advisors, one of the world’s largest money managers, installed in March a statue of a defiant girl in front of the Wall Street bull in downtown Manhattan. As part of that rollout, State Street vowed to take action against companies that it holds which don’t take action to increase their boards’ gender diversity.
State Street has since voted against 400 of those companies.
“Basically, we hold these companies forever,” said Lynn Blake, the CIO of Global Equity Beta Solutions. State Street is a major player in passive investing, which means that they hold stocks of companies in major market indexes.
“We’re the epitome of a long term investor and the only way we can influence companies is by active engagement and ultimately our vote,” Blake added.
State Street declined to identify the companies it voted against, but said that the vast majority of the companies — 394 of the 400 — are based in the US.
Over the past few months, during proxy voting season mostly in the US, State Street identified 476 companies that didn’t have any women on their boards. Four hundred of them didn’t take any action to increase their diversity.
In turn, State Street voted against the reelection of the chair or the most senior member of the nominating and governance committee — those that identify future directors — at those companies.
It is becoming increasingly common for investors to call for change at the companies they hold, though State Street may have taken one of the most vocal steps yet.
Its competitor, BlackRock, the world’s largest asset manager, “voted against board members at five companies who sat on nominating committees but failed to respond to investors’ concerns about diversity,” per Reuters.
To be sure, State Street also has its own gender problem, with women making up only one in five employees at the firm’s investment unit, and only three women on the company’s 11-person board. The company has said it is working on improving that ratio.
State Street Global Advisors managed $US2.6 trillion as of June 30, a representative said.