The purpose of Fearless Girl* was to raise awareness about the importance of gender diversity in corporate leadership, and to encourage companies with all-male boards to take steps to add female board members. She got the world’s attention — 423 companies have added a woman to their board since Fearless Girl stepped into the spotlight on International Women's Day in 2017.
*Sculpture by Kristen Visbal, commissioned by State Street Global Advisors
Research shows that companies with strong female leadership perform better than those without.1 In other words, hiring women into top leadership roles is good for business. And while the corporate introspection prompted by Fearless Girl may have started at the board level, it shouldn’t stop there. Because diversity on boards starts with a more diverse workforce.
Our focus on diversity has had a multiplier effect throughout the industry, with more asset managers and owners calling for improvements
- Rick Lacaille, Senior Investment Advisor, State Street Global Advisors, and chairman of our Executive Corporate Responsibility Committee
That’s why this year, State Street Global Advisors is calling on our portfolio companies to go beyond board-level reporting and disclose gender diversity at all levels of management. Diversity is one of the many corporate responsibility aspects that we are keenly aware will benefit our own company, our clients and the economy over the long term.
1”Women on Boards: Global Trends in Gender Diversity on Corporate Boards,” MSCI, November 2015
In 2018, our board committed to monitoring material ESG risks to our business. Key to meeting that responsibility is having the right data. By aligning our annual CR reporting with the framework established by the Sustainability Accounting Standards Board, we’re focused on the issues most likely to have a material impact on our performance – and that our clients care most about. Further facilitating our materiality assessment and delivering greater transparency of our CR data, we continue to structure our disclosure around the Global Reporting Initiative Standards.
As a global company, we must ensure that we’re meeting requirements in all of the communities where we operate. To do that, we also report annually on our management and impacts related to climate change in the context of the Task Force on Climate-related Financial Disclosures guidelines, our efforts toward global sustainable development according to the United Nations Sustainable Development Goals framework and all relevant regulatory information as stipulated by the EU Directive on Non-financial Reporting.
Building on Our Momentum
We’re working to lead by example. We’ve set aggressive three- and five-year diversity hiring goals and we’re making progress at many levels of the company. Women now make up 40 percent of our Management Committee, the company’s most senior strategy and policy-making team, and we have three women on our board of directors.
We evaluate ourselves against relevant international frameworks, including the Global Reporting Initiative and Sustainability Accounting Standards Board. Our 2019 corporate responsibility reporting will include data recommended for Asset Management and Custody Activities as well as Software and IT Services, and will also include disclosure of our U.S. Equal Employment Opportunity Commission (EEOC) statistics.
Our employees provide critical support to building our strong culture of corporate responsibility. Today, with more than 2,000 members globally, the Environmental Sustainability Employee Network leverages our employees’ commitment to the environment; helping us achieve our goals for reducing water usage, waste and carbon emissions, among other important criteria.
Delivering on ESG Data
The most pressing challenge facing ESG investing is the lack of consistent, quality data. To help listed companies more easily identify the ESG factors that are most material to their business, in 2018 State Street Global Advisors’ ESG team built R-FactorTM. The R-Factor scoring system aligns multiple data sources to widely adopted, transparent materiality frameworks like SASB to drive standardization of reporting and help companies improve their ESG scores.
Our data and analytics business is also focused on creating data-driven ESG solutions that will help institutional investors report on their underlying ESG exposures. To that end, in 2018 State Street officially launched ESGX® — our multi-factor risk analytics engine that uses market, portfolio and ESG data to identify potential ESG risks for our custodial clients.