BJ’s Wholesale Club – Diversity Report (2021)
Outcome: In exchange for with withdrawing our EEO-1 report disclosure proposal, BJ’s has agreed to:
RESOLVED: Shareholders request that the Board of Directors adopt a policy requiring BJ’s Wholesale Club Holdings Inc. (“BJ’s”) to disclose on its website BJ’s Consolidated EEO-1 Report, a comprehensive breakdown of its workforce by race, ethnicity and gender that BJ’s is required to submit annually to the U.S. Equal Employment Opportunity Commission (EEOC).The Company shall annually disclose its EEO-1 Report within 60 days of submission.
The business case for workforce diversity is compelling. McKinsey & Company, for example, found in 2015, and in a larger study in 2017 that highly diverse executive teams had higher returns on equity and earnings performance than those with low diversity. Companies in the top quartile for gender diversity on executive teams were 21 percent more likely to have industry-leading profitability. Companies in the top quartile for ethnic/cultural diversity were 33 percent more likely to have industry-leading profitability.
According to BJ’s 2020 Proxy Statement, the company’s board of directors is 30 percent diverse by gender while no women are among its named executive officers. The race and ethnicity of its board and executive leadership team are undeterminable. The Company states that it “has a long tradition of embracing diversity” and it “strive[s] to have a workforce that reflects the communities in which we operate.” However, without publicly disclosing workforce composition data investors have no information with which to assess if and how the company is attracting, retaining and promoting a diverse workforce reflective of the communities in which it operates.
2020 has been a year with renewed focus on the problems of systemic racism in the United States. One way that companies can address the issue is through its recruitment and retention practices – working to provide equity, inclusion, and justice. As our society asks more of all of us when it comes to race, a beginning step that a company like ours can take is providing meaningful transparency about our workforce.
Shareholder proposal votes at recent annual meetings indicate that shareholder interest in workforce composition data is strong. A majority of shareholders of Travelers Companies (50.9 percent) voted for a workforce diversity disclosure proposal in 2019. Travelers responded by publishing its full EEO-1 report and committing to do so annually. In 2020 support for shareholder proposals requesting reports on workforce diversity programs continued to be strong. Proposals filed at Fastenal and Fortinet, for example, earned 61 percent and 70 percent support, respectively.
Peer companies including Starbucks and Target publish full EEO-1 reports as well as quantitative goals and strategies to foster inclusion and expand diversity in their employment ranks.
- McKinsey & Company, Delivering through Diversity; V. Hunt, S. Prince, S. Dixon-Fyle,L. Yee; January, 2018