On September 15, 2020, I had the pleasure and privileged to be a guest speaker in Professor Nadine de Gannes’s session on equity, diversity and inclusion (EDI). It was part of an MBA elective on Responsible Governance offered at the Ivey Business School at Western University in London, Ontario, Canada. I participated in a panel discussion with Maria Zhivitskaya, Ph.D, who is currently working in Investment Stewardship at Vanguard.
I co-wrote three cases that students prepared responses for in advance of the session. The first case was Goldman Sachs’s controversy on gender pay equity in 2019 after the U.K. government released gender pay gap statistics in February 2019. The government reporting also shone a light on how many women occupy senior leadership positions at companies. The second case dealt with Santander Consumer USA Holdings, Banco Santander’s U.S.-based auto-financing wing. Speech recognition technology was used to rate employees’ daily. It was also used to ensure that employees were prevented from telling customers, who were disproportionately from communities of colour, debt options for repayment. The company eventually changed its practices. Lastly, we look at UBS’s practice of re-basing variable compensation for women returning from maternity leave. In other words, women’s bonuses were cut. Meanwhile, men who completed mandatory military service, over several years, did not reportedly get their salaries re-based. This case evaluated UBS’s use of this practice as well as the promotion of women internally.
These case studies illustrated the reputational risks that these controversies carried for companies. It also highlighted the importance of strong management of ESG issues related to EDI and talent management. Overall, I was impressed with students’ engagement with the materials and their thoughtful questions. If you are an investor or an academic interested in exploring these issues further, feel free to get in touch about working together.