Inequality Is a Bigger Problem Than Climate Change: Q&A

(Bloomberg) -- Companies are getting better at recruiting diverse employees, but there are still a lot of opportunities for them to tackle growing inequality, according to John Streur, CEO of Eaton Vance Corp.’s responsible investing unit Calvert Research and Management.

While almost all S&P 100 companies show some evidence of internal diversity initiatives and offer family-friendly benefits like a flexible work environment, only 25% provide a breakdown of their employees’ gender and race, according to a review earlier this year by the firm.

Streur spoke to Emily Chasan on Oct. 25. Comments have been edited and condensed.

How do you look at inequality when investing?

We factor it into every single model and decision. We look at gender issues, racial issues and income issues in every company we invest in. There’s a need for companies to be a positive part of reducing the income inequality and the opportunity equality in the communities where they do business, because this just isn’t really working.

Inequality is a bigger issue than climate change — it’s at an extreme.

Why is this an issue for individual companies?

An individual company is not responsible for inequality, but collectively, companies are responsible for issues associated with hiring practices, creating well-being for a diverse workforce, how they engage in communities, how they disclose information and what their policies are on gender and racial bias and inclusiveness.

What do you want to see companies do to address inequality?

We like to see training and development programs that are designed for individuals and small groups instead of broad groups. There are a number of practices companies can use to really enhance diversity within their firm.

Most companies are improving on their hiring numbers for women and minorities, but very few companies are improving on progressing women and minorities into middle and upper management.

Do you think policies will be a big shareholder proposals focus?

Yes. It’s a big issue and it’s a big opportunity. Companies that create well-being for a diverse workforce are beginning to demonstrate superior financial results and that indicates some companies have really figured out how to draw a diverse talent pool, put together a team and achieve better results. At the end of the day that’s what it’s all about.

I was at a company the other day where they are just starting on diversity issues and looking at maternity leave policies. I sat down with their diversity team and it had some men and some women, but it was all white faces. You look at that, and say, there’s a lot of opportunity for improvement here.

To contact the reporter on this story: Emily Chasan in New York at echasan1@bloomberg.net.

To contact the editors responsible for this story: Alicia Ritcey at aritcey@bloomberg.net, Ainslie Chandler

©2017 Bloomberg L.P.