Proto Labs Inc. | Racial and Gender Board Diversity Report at Proto Labs Inc.

Status
Withdrawn
AGM date
Resolution details
Company ticker
PRLB
Lead filer
Resolution ask
Report on or disclose
ESG theme
  • Social
  • Governance
ESG sub-theme
  • Diversity, equity & inclusion (DEI)
Type of vote
Shareholder proposal
Filer type
Shareholder
Company sector
Materials
Company HQ country
United States
Resolved clause
Shareholders of Proto Labs Inc. (the Company) request that our Board of Directors (the Board) disclose in its annual proxy statement each director/nominee’s self-identified gender and race/ethnicity, as well as the skills and attributes that are most relevant to the Company’s overall business, long-term strategy, and risks. The requested information shall be presented in matrix format and shall not include any attributes the Board identifies as minimum qualifications for all director candidates (the Board Matrix).
Supporting statement
Diversity, inclusive of gender and race, are critical attributes of a well- functioning executive team and is necessary to meaningfully drive diversity throughout an organization. Our executive management team has only one woman on the Board and an undeterminable number of people of color. This team sets the tone from the top. Disclosure of a Board Matrix would signal to employees, customers, suppliers, and investors that directors themselves are practicing diversity and inclusion at the Board level. When investors prioritize board diversity in their proxy voting guidelines and engagement initiatives (such as Vanguard,1 BlackRock,2 and State Street3 ), significant time and resources must be spent attempting to ascertain information from ambiguous and aggregate company disclosures or relying on data providers, which draw from the same imprecise sources. Even with photographs provided, investors and data providers may be unable to determine the race or ethnicity of directors appropriately. Hence, it can be unnecessarily challenging for investors to fulfill their fiduciary duties and vote according to their proxy voting guidelines. The business case for workforce diversity is compelling. For example, McKinsey & Company found in 2015, 2017, and again in 2019 that companies with highly diverse executive teams had higher returns on equity and earnings performance than those with low diversity.4 A Board Matrix would enable investors to make better-informed proxy voting decisions by providing consistent, comparable, and accurate data concerning our directors in a structured and decision-useful format. Such information would enable investors to: (1) assess how well-suited individual director nominees are in light of our long-term business strategy and risks, including the overall mix of director attributes and skills; (2) identify any gaps in skills or attributes; and (3) make meaningful, year-over-year comparisons of the Board’s composition; and (4) ascertain the self-identified gender, race/ethnicity, skills and attributes of any particular director who has assumed leadership roles on the board/committees, as well as his/her/their tenure. Other leading companies, such as Intel, 3M, Home Depot, and Wells Fargo, have published a Board Matrix with individualized director data in a decision-useful format. Their matrices also use EEO-1 categories to disclose individual directors’ diversity, which allows for consistent and comparable data.

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