Goldman Sachs Asset Management | Workplace Culture: Concealment Clauses at THE GOLDMAN SACHS GROUP, INC.

Status
Withdrawn
AGM date
Previous AGM date
Resolution details
Company ticker
NYSE: GS
Lead filer
Nathan Cummings Foundation
Resolution ask
Report on or disclose
ESG theme
  • Social
ESG sub-theme
  • Whistleblowing
Type of vote
Shareholder proposal
Filer type
Shareholder
Company sector
Financials
Company HQ country
United States
Resolved clause
RESOLVED: Shareholders request the Board of Directors oversee the preparation of an annual public report describing and quantifying the effectiveness and outcomes of The Goldman Sachs Group, Inc.’s (Goldman Sachs) efforts to prevent harassment and discrimination against its protected classes of employees. In its discretion, the Board may wish to consider including disclosures such as:
the total number and aggregate dollar amount of disputes settled by the company related to abuse, harassment, or discrimination in the previous three years;the total number of pending harassment or discrimination complaints the company is seeking to resolve through internal processes, arbitration, or litigation;the retention rates of employees who raise harassment or discrimination concerns, relative to total workforce retention; the aggregate dollar amount associated with the enforcement of arbitration clauses;the number of enforceable contracts for current or past employees which include concealment clauses, such as non-disclosure agreements or arbitration requirements, that restrict discussions of harassment or discrimination; andthe aggregate dollar amount associated with such agreements containing concealment clauses.This report should not include the names of accusers or details of their settlements without their consent. It should be prepared at a reasonable cost and omit any information that is proprietary, privileged, or violative of contractual obligations. 
Supporting statement
SUPPORTING STATEMENT
In 2021, after receiving majority support for a shareholder resolution requesting they do so, Goldman released a report reviewing its mandatory arbitration requirement for employee harassment or discrimination claims. In light of that review, the Board decided that “employees who assert a claim of sexual harassment in an arbitration will have the option to waive confidentiality as to the arbitration decision.”[1] The firm did not release other protected classes from this confidentiality obligation. 
Investor concerns related to Goldman’s treatment of its employees by race, ethnicity, and other protected class remained unaddressed. Black individuals comprise 13.6 percent of the United States’ population[2] but only 3.4 percent of Goldman’s executive and management teams.[3] This representation percentage has remained static over time, only increasing by 0.31 percent since 2020[4], the first year for which this data was available.  
Given the company’s ongoing use of non-disclosure agreements and mandatory arbitration, which conceal from external audiences internal culture challenges, the extent to which race-based harassment and discrimination exists within Goldman is unknown. 
There have been several high-profile derivative suits settled, including at Twentieth Century Fox, Wynn Resorts, and Alphabet, alleging boards breached their duties by failing to protect employees from discrimination and harassment, injuring the companies and their shareholders. 
Civil rights violations within the workplace can result in substantial costs to companies, including fines and penalties, legal costs, costs related to absenteeism, reduced productivity, challenges recruiting, and distraction of leadership. A company’s failure to properly manage its workforce can have significant ramifications, jeopardizing relationships with customers and other partners.
A public report such as the one requested would assist shareholders in assessing whether the Company is improving its workforce management.
[1] https://www.goldmansachs.com/investor-relations/corporate-governance/corporate-governance-documents/report-on-review-of-arbitration-program.pdf
[2] https://www.census.gov/quickfacts/fact/table/US/PST045222
[3] https://www.goldmansachs.com/our-commitments/sustainability/2022-people-strategy-report/multimedia/report.pdf
[4] https://www.goldmansachs.com/our-commitments/sustainability/sustainable-finance/documents/reports/2020-sustainability-report.pdf?source=website

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