Citigroup, Wells Fargo, Bank of America urge shareholders to vote against
Three of the nation’s biggest banks are asking shareholders to reject racial-equity resolutions after they expressed solidarity with the Black Lives Matter movement last year.
Citigroup Inc.
C,
Wells Fargo & Co.
WFC,
and Bank of America Corp.
BAC,
were among the many large U.S. companies to make public statements of support in response to widespread protests last summer after the police killings of George Floyd and Breonna Taylor. In recent days, they have all officially opposed shareholder groups’ calls for them to conduct and publicize racial-equity audits and other changes, saying they are already doing enough to address equity issues.
The shareholder proposals urge the banks to examine their practices and policies and identify ways to “avoid adverse impacts on nonwhite stakeholders and communities of color,” something the banks says is unnecessary because they are juggling different, related initiatives and/or have committed money to such issues internally and externally. The proposals are included in proxy statements to shareholders, which allow for the companies to support or oppose shareholder resolutions and explain why ahead of a vote at their annual meetings.
For more: Companies declared ‘Black lives matter’ last year, and now they’re being asked to prove it
CtW Investment Group wrote in its proposal to Citi shareholders that the bank “has a conflicted history when it comes to addressing racial injustice within the communities it serves.” The group provides examples, including Citi getting fined by the Treasury Department in 2019 for failing to offer all customers mortgage discounts and credits; its required minimum maintenance fees and minimum daily balances; and the fact that it has only one Black executive in the C-suite (Chief Financial Officer Mark Mason).
“While we disagree with the overall approach in this proposal, we are completely aligned with its stated goal of addressing racial inequity in the financial sector,” Citi said in its proxy filed Wednesday.
The bank pointed to its $1 billion commitment to providing greater access to banking and mortgages for communities of color, plus making investments in Black businesses. It also said, “As recently as September 2020, Citi released a 104-page report on the economic cost of Black inequality in the United States titled ‘Closing the Racial Inequality Gaps,’” and said its efforts on these issues are available to the public.
Citi is also recommending shareholders vote no on a couple of other racial equity-related resolutions, such as adopting a “Rooney Rule” policy to increase diversity in its board of directors and disclosing its direct and indirect lobbying activities in a report.
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CtW also mentioned minimum requirements for deposits and fees in its Bank of America resolution, adding that the Treasury Department found in 2018 that the bank offered proportionately fewer home loans to minorities than white applicants in Philadelphia, and that BofA’s C-suite is just 8% Black.
Bank of America said in its proxy released last week that it has committed $1 billion to supporting minority-owned businesses, jobs initiatives in Black and Hispanic communities, affordable housing and donations to historically Black colleges and universities and more. It also touted its work with “consumer advocates in the design and marketing of our financial services and products” and its efforts to diversify its workplace and leadership.
In its proposal at Wells Fargo, the Service Employees International Union Pension Plans Master Trust mentions the bank’s record of discriminatory lending practices that have led to different lawsuits and a settlement with the Department of Justice in 2012, as well as settlements of employment-discrimination claims.
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