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Warren Buffett urged to take DEI strategy leadership role

Berkshire Hathaway is being urged to take an industry leadership role by publishing its diversity, equity and inclusion strategy and data. So far, it has declined to do so.

Investors have been trying to get firms to publicly disclose their diversity, equity and inclusion strategies and data for years. Many firms are complying with these requests as well as in response to social justice movements, but some are resisting, which was evident at Berkshire Hathaway Inc.'s annual meeting Saturday.

There, an investor advocacy group proposed that Berkshire Hathaway take on a diversity, equity and inclusion strategy leadership role and have its many firms publish its DEI data. Berkshire rejected the appeal, which also prompted a defense by the firm of Warren Buffett who, as chair and CEO, "has a record of opposing efforts, seen or unseen, to suppress diversity or religious inclusion."

But Berkshire, which wholly owns such brands as Geico, Duracell and Dairy Queen, may increasingly be an outlier in publishing DEI data, which includes a company's racial and gender breakdowns.

Meredith Benton, representing the nonprofit investor advocacy organization As You Sow in Berkeley, Calif., proposed requiring Berkshire to report on its DEI efforts, including trends related to recruitment, promotion and retention. Benton is also principal and founder of the consultancy Whistle Stop Capital LLC, which advises firms on environmental, social and corporate governance.

In an interview, Benton said it was important to raise this issue at Berkshire's annual meeting because the firm "has a huge amount of influence in their respective industries" and that "there's a lack of leadership at the top, so that brings us to Buffett by default."

In March, As You Sow released a ranking of firms by their DEI disclosures. Intel tops its list, not only with a breakdown of gender and U.S. ethnicity, but for data slices such as gender representation as technical or nontechnical and from entry-level to executive level.

Berkshire defends its approach

Berkshire defended its DEI strategy at its more than 60 operating businesses and said it would be "unreasonable to ask for uniform, quantitative reporting" about different operations in different geographic locations.

In making its case for a "no" vote on the As You Sow proposal, Berkshire said it is "supporting the longstanding business model that each of the businesses is individually responsible for developing and implementing policies, programs and results, including those related to diversity, equity and inclusion."

At the meeting, Benton told Berkshire that 70% of the S&P 500, an index of the top firms, "currently share diversity and inclusion data at some level," she said. "Only 22% of Berkshire companies do at any level."

A phone call to Berkshire for comment was not immediately returned. The firm did issue a strong statement in 2001 on the importance of bias-free management. "In neither the purchase of goods nor the hiring of personnel, do we ever consider the religious views, the gender, the race or the sexual orientation of the persons we are dealing with. It would not only be wrong to do so, it would be idiotic. We need all of the talent we can find, and we have learned that able and trustworthy managers, employees and suppliers come from a very wide spectrum of humanity."

At the meeting, Benton, whose remarks were pre-recorded, told the Berkshire board "you may each individually, truly and genuinely hire, mentor and promote the best people for the job regardless of their gender, race, ethnicity, sexual orientation or any immutable characteristic. But we can't conclude that this is the mindset of each of your employees, managers and hiring directors," according to a Yahoo Finance live stream transcript, published on

It's just a matter of posting a PDF

The sticking point isn't about collecting the data, it's about sharing it. Employers with more than 100 employees must report demographic workforce data to the U.S. Equal Employment Opportunity Commission (EEOC), which includes data by race, ethnicity and sex.

EEOC reporting means that firms have the data readily available, and "it's just a matter of putting a PDF on your website," Benton said. Not publishing the data "is a very intentional decision; it's not about resources," she said.

Investors have pushed for the disclosure of human capital data, and the U.S. Securities and Exchange Commission (SEC) has a comment collection on this topic going back to 2017. But the #MeToo movement, as well as Black Lives Matter and other social justice movements, are also credited with accelerating interest in corporate DEI data disclosures.

Investors argued that workforce management is material in evaluating a firm's risk. Among those advocating for disclosure was the Los Angeles County Employees Retirement Association (LACERA), which manages $58 billion in assets.

We're in an age of reckoning about achieving diversity -- it's no longer an option.
Roberta GuiseFounder and president, FemResources Inc.

A firm's workforce is often described as its "most valuable asset," wrote Jonathan Grabel, LACERA's chief investment officer, in a 2019 comment filed with the SEC. "Yet investors typically have little insight into how companies are managing the risks and opportunities associated with this 'most valuable asset.'"

Late last year, the SEC adopted a "principles-based" HR workforce data disclosure rule for all public firms. Still, it gives firms latitude in what they report, said Frank Borger Gilligan, a corporate, M&A and securities attorney at Dickinson Wright PLLC and a former assistant commissioner for the securities division of the Tennessee Department of Commerce and Insurance.

Before the new SEC rule, the only HR disclosure requirement public firms had to make was the number of employees, Gilligan said. But the principles-based rule only requires firms to disclose human capital data that they believe to be material to the company. It allows firms to "disclose as much or as little of that information as they feel as material."

Over time, Gilligan believes firms will publish more of their DEI data "because that's what investors want to see."

Roberta Guise, founder and president of FemResources Inc., an advocacy group, said employers need to take an employee point of view on DEI strategy and data. Who wants to work for a firm that hides its diversity efforts and challenges? she argued.

"We're in an age of reckoning about achieving diversity -- it's no longer an option," Guise said.

Patrick Thibodeau covers HCM and ERP technologies. He's worked for more than two decades as an enterprise IT reporter.

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