Workforce and board diversity are among the top engagement priorities for investors in the 2021 proxy season, according to a report released Thursday by the EY Center for Board Matters.
The organization interviewed governance specialists from more than 60 institutional investors with a collective $38 trillion under management, including asset managers, public funds, labor funds and faith-based investors.
For those investors, the top issues in 2021 are workforce and board diversity, climate risk and environmental issues, executive compensation, and other strategic workforce issues.
For corporate boards, the investors want to see a focus on board refreshment to align with strategic oversight, more diversity, and for boards to improve management reporting and director education.
On workforce diversity, investors see it as key to driving innovation and performance. "This is of particular importance in a dynamic environment marked by ongoing business model disruption, changing stakeholder demands and accelerating sustainability risks," the report said.
Asked about strategic drivers and threats to companies, the investors said that the biggest factor for success is quality and execution of a multifaceted strategy, while the biggest threats are climate risk, business model disruption and changing customer demands.