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State Street Says Companies Must Have Women on Their Boards

By Saijel Kishan

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State Street Global Advisors, one of the world’s biggest asset managers, said all global companies in which it invests must have at least one woman on their boards to gain the firm’s support during the upcoming proxy season.

SSGA’s previous policy applied only to companies that are included in major indexes.

The asset manager, which oversees $3.9 trillion, also said it expects boards of companies in major indexes in the U.S., Canada, Britain, Europe and Australia to have at least 30% women directors for the 2023 proxy-voting season, according to a letter posted Tuesday on its website.

“While boards have become more gender diverse, it is clear that this work isn’t yet complete,” Cyrus Taraporevala, chief executive officer of State Street Corp.’s investment-management unit, said in the letter.

SSGA repeated that in the next proxy season, it will vote against the management of U.S. and U.K. companies that don’t have a person of color on their boards and also against those that fail to disclose the racial, ethnic and gender breakdowns of their boards. The initiative focuses on companies in the S&P 500 and FTSE 100 indexes, many of which count SSGA among their biggest shareholders.

On climate, SSGA said for the 2022 proxy season, it will vote against board directors that represent companies in benchmark indexes in the U.S., Canada, Britain, Europe and Australia who aren’t aligning themselves with disclosures asked by the Task Force for Climate-related Financial Disclosures.

SSGA also said it will start targeting the biggest corporate emitters it’s invested in to discuss their climate-transition plans, including their strategies for decarbonization and capital allocation. The Boston-based firm said it will hold companies accountable next year that fail to meet expectations.

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