New York State Comptroller Thomas P. DiNapoli, as trustee of the New York State Common Retirement Fund (Fund), has filed shareholder proposals with portfolio companies Activision Blizzard Inc., Tesla Inc. and Starbucks Corp. requesting they report on their efforts to prevent harassment and discrimination against employees and steps taken to improve workforce management.
“No one should be subjected to sexual harassment, racial discrimination or bias in the workplace,” DiNapoli said. “When companies turn a blind eye to abuse by their executives, managers, employees and customers, they perpetuate the harm and put investors at risk. These three companies have all had sexual harassment or racial discrimination controversies and we are seeking a full accounting of what they are doing to stop these abhorrent behaviors and what it’s costing the companies.”
The proposals ask the companies to disclose, among other things:
- The total number and aggregate dollar amount of disputes settled by the company related to sexual abuse or harassment or discrimination based on race, religion, sex, national origin, age, disability, gender identity, or sexual orientation; and
- The average length of time it takes to resolve harassment complaints and the total number of pending harassment or discrimination complaints the company is trying to resolve internally or through litigation.
Beyond the pain and suffering they cause, the proposals note that civil rights violations within the workplace can result in substantial costs to companies, including fines and penalties, legal costs, absenteeism, and reduced productivity. A company’s failure to properly manage its workforce can also tarnish its public image, make it more difficult to retain and recruit employees, and jeopardize relationships with customers and partners.
At Activision Blizzard, the California Department of Fair Employment and Housing’s investigation resulted in litigation alleging discrimination, retaliation and unequal pay. The department estimates the company's total liability to 2,500 allegedly injured employees to be $930 million. News reports have detailed alleged sexual abuse, discrimination, harassment, and retaliation directed toward employees for years. Recently, Microsoft announced plans to acquire Activision Blizzard. The Fund will continue to monitor developments related to the acquisition. It remains imperative that workers’ concerns are addressed, and executives are held accountable for any wrongdoing.
Tesla has been the subject of news reports and allegations of gender and race discrimination, harassment and retaliation. In October 2021, a California jury returned a $137 million verdict, including $130 million in punitive damages, against Tesla for its racially hostile work environment.
Starbucks recently resolved allegations made by the Equal Employment Opportunity Commission over alleged racial bias in its employee promotions. There have also been news reports of allegations and lawsuits claiming that the company failed to protect employees from discrimination and harassment.
About the New York State Common Retirement Fund
The New York State Common Retirement Fund is one of the largest public pension funds in the United States with assets of approximately $267.8 billion as of Sept. 30, 2021. The Fund holds and invests the assets of the New York State and Local Retirement System on behalf of more than one million state and local government employees and retirees and their beneficiaries. It has consistently been ranked as one of the best managed and best funded plans in the nation.