The assassination of George Floyd sparked a wave of promises from American corporations to promote racial justice. Almost a year later, major US corporations are under pressure to show progress in delivering on those promises.
Shareholders will vote on some of these initiatives in the coming weeks, including whether or not Walmart should report on the fairness of its compensation scale and whether Facebook and Google / Alphabet should appoint a civil rights specialist to their boards.
Another commonly suggested option is a racial equity check, which compares company data with what is said in glossy marketing materials.
Proponents characterize this report as a risk management tool that can help protect brands.
“There are a good number of shareholders who recognize that this is an issue that can cause significant reputational damage,” said Tejal Patel, corporate governance director at CtW Investment Group, an activist group that is taking action at several leading companies organized.
Proposals calling for a racist stock screening found support from around 30% or more of shareholders in several large companies, including Citigroup, JPMorgan Chase, Goldman Sachs and Johnson & Johnson. And later this month, Amazon shareholders will ponder a similar audit plan.
“It’s work in progress,” said Olivia Knight, racial justice manager at As You Sow, another advocacy group that has been actively involved in proposals to combat racial justice and diversity, justice and inclusion, or DEI.
The current advance by activists is in response to events last spring when the police killing of Floyd, Breonna Taylor and other African Americans sparked mass protests and a national racial justice settlement.
Following this uprising, large corporations quickly made statements supporting Black Lives Matter and pledging to do more to respond to non-white consumers, employees and communities.
Activists have been somewhat skeptical of these pledges, partly because American companies have made no progress in promoting diversity at the highest levels. The largest US companies are still predominantly run by white men.
CtW and the Service Employees International Union (SEIU) drafted resolutions late last year calling for racial equality tests with eight major financial groups, several of which have completed several million government investigations into lending discrimination in recent years.
Large mainstream banks also have a reputation for avoiding inner-city neighborhoods and creating “banking deserts” that make it more likely that residents will be forced to turn to predatory lenders.
The resolutions called for a business review, including lending practices and political contributions, which should be prepared in consultation with civil rights experts and made publicly available.
“I think if someone looked in it would be more transparent,” said Toni Smith, who said her New Orleans branch of Chase Bank discouraged her when she needed a car loan and a business equipment loan.
Smith, who works in home nursing and cosmetics, is struggling to pay lenders who have charged interest rates above 20%. She told AFP she was planning to file for bankruptcy.
“If we don’t sit on money, you don’t get the chance,” she said. “We can’t work our way up.”
The challenges Black Americans faced in building prosperity across generations because they had no access to credit and racially motivated restrictions on housing was another focus of the racial justice movements.
The templates for the exam include reviews similar to those already conducted at Facebook, Starbucks, and other companies, said Patel, who stressed that the review must be independent of management.
Written by civil liberties attorney Laura Murphy and civil rights law firm Relman Colfax, the Facebook exam praised the social media giant’s efforts to address voter suppression and a few other moves, but criticized steps other than ” serious setbacks for civil rights â.
They also said the platform should have overturned statements by former President Donald Trump that it promoted violence against civil rights activists.
CtW withdrew a proposal from Morgan Stanley after the investment bank agreed to an independent review of its talent program. The sponsors also discontinued a campaign at BlackRock after the asset management firm agreed to commission an audit.
Six other companies decided to fight the resolutions, citing major philanthropic and business announcements dealing with racial justice.
JPMorgan announced a $ 30 billion push to promote racial justice in October that included pledges to provide 40,000 home loans for black and Latin American households, the opening of new branch offices for community centers in underserved communities, and public progress reports.
The CtW proposal, however, referred to the bank’s “conflict history” in the running, including a $ 55 million US mortgage discrimination dispute resolution, the bank’s launch of a US small business aid program especially white areas and donations to police foundations benefited disproportionately in New York and New Orleans.
“We believe we are taking appropriate steps to address the issues raised in the proposal,” said JPMorgan in response to the action. “Conducting a racial justice test at this point would not provide us with any useful additional information.”
At the annual meeting on Tuesday, JPMorgan CEO Jamie Dimon said promoting racial justice is “complex and we are determined to get it right”.
Moments later, bank employees announced that CtW’s proposal received 39% of the vote.