Trillium Successfully Withdraws Board Diversity Proposal at Wabtec
March 10, 2014: Trillium Asset Management is pleased to announce that it has withdrawn its shareholder proposal at Wabtec Corporation (NYSE: WAB) following the company’s agreement to institutionalize a commitment to board diversity inclusive of gender, race and ethnicity.
Trillium’s shareholder proposal, which was filed on behalf of Rebekah Helzel, asked the company to:
Publicly commit itself to a policy of Board inclusiveness to ensure that women and minority candidates are routinely sought as part of every Board search the company undertakes;
At the time of the filing, Wabtec had no woman on its board of directors and did not disclose that diversity, inclusive of gender or race, was part of its board nominee search process. Numerous studies have underscored the nexus between greater board and management diversity, and improved corporate governance and financial performance.
Following a successful dialogue with the company this winter, Wabtec’s board agreed to amend its Corporate Governance Guidelines, Nominating & Corporate Governance Committee Charter and 2014 proxy statement to include a clear definition of diversity, inclusive of gender and race, and make diversity an intentional part of board nominee search criteria. Subsequently, Trillium withdrew its proposal. Under its revised charter, Wabtec’s Nominating & Corporate Governance Committee now holds itself accountable to goals and responsibilities that include:
[E]nsuring that the Board of Directors consists of individuals from diverse backgrounds (including diversity of gender, race and ethnicity) and experience who, collectively, provide meaningful counsel to management. In order to achieve this goal the Committee will actively seek and consider diverse candidates, inclusive of gender, race and ethnicity
The infrequency with which companies look to refresh their board is often cited as a reason women have not moved into boardrooms at a faster pace. Committing to an annual review of the skills, backgrounds, the diversity inclusive of gender and race, among other attributes was a critical element of our dialogue, as was urging companies to look beyond traditional talent pools for board candidates.
“We commend the company for engaging in productive dialogues with shareholders, including Trillium and the Pennsylvania State Treasurer’s Office, along with The Thirty Percent Coalition, which resulted in meaningful revisions to its corporate governance documents.” said Susan Baker of Trillium Asset Management. “Like many companies in the industrial sector, Wabtec has sought skilled board members through traditional talent circles which often do not include women. In addition to revising its corporate charter documents we are gratified that the board is closely examining its governance practices and taking important steps to broaden its board nominee search process, “she added.
“I’m proud that Wabtec — a company with deep roots in the Pennsylvania economy — agrees that a diverse board can lead to increased value to the company and its shareholders. I also commend Wabtec for committing that future director searches will include diversity as a focus” said Pennsylvania Treasurer Rob McCord.
“The meaningful revision to Wabtec’s corporate governance documents is an excellent example of how progress can be made in a collaborative fashion. We are honored to have been a part of this important dialogue and applaud Wabtec for the commitment they have made to include gender diversity as an integral part of their board nomination process,” said Charlotte Laurent-Ottomane, Executive Director of the Thirty Percent Coalition.
“Wabtec values constructive dialogue with its shareholders and commends Trillium for its dedication to shareholder issues,” said Albert J. Neupaver, Chairman and Chief Executive Officer. “We are highly committed to principles of diversity as part of our drive to create sustainable value for all of our shareholders. As part of this commitment our Board believes that a diverse membership with varying perspectives and experiences is an important Board attribute.”
For more information: Randy Rice, Trillium Asset Management, 617-515-6889, firstname.lastname@example.org.