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Pension group to Amazon: Protect investors, make way for women

At Amazon.com Inc., a key executive charged with sexual harassment may have reportedly left the business, but the e-commerce giant has a long way to go to make women welcome in its top ranks, a group that works with union pension funds told the company in a Nov. 30 letter.

CtW Investment Group, which advocates for union-sponsored pensions, asked Amazon Chairman and CEO Jeff Bezos to implement multiple changes at the company, including setting gender diversity targets for Amazon's executive team, guaranteeing gender parity on the company's board of directors and reviewing Amazon's employment agreements to make sure employees have the ability to report harassment.

Making those changes is not just about avoiding a public relations nightmare, CtW said: The group argues that controversies about gender parity and diversity threaten Amazon investors, too.

"We believe that the evidence suggests that Amazon's gender diversity gap creates significant risks for long-term shareholders, and that further delays in rethinking Amazon's approach to human capital management may have dire consequences," CtW wrote in the letter. Collectively, the unions that the Washington, D.C.-based group represents manage about $250 billion in assets, it said in the letter.

An Amazon spokeswoman declined to comment directly on the letter Dec. 7, pointing instead to an emailed statement in which the company said there are "many women in significant roles at Amazon," including Beth Galetti, who is the company's senior vice president of human resources, and Shelley Reynolds, who serves as vice president, worldwide controller and principal accounting officer.

Amazon has also received recognition from 2020 Women on Boards, a campaign focused on adding women to corporate boards, for "having one of the most gender diverse boards in tech," and from social media website LinkedIn for being the second-best company in the U.S. at attracting talent, the spokeswoman said.

As of Dec. 7, Amazon's board included eight men and three women, according to S&P Capital IQ.

The letter comes about a month and a half after Roy Price, the top executive at Amazon Studios, resigned as he faced allegations that he made unwanted advances toward an Amazon producer, according to a report by CNN Money, citing an Amazon spokesperson. Following his departure, two other executives at the entertainment-focused segment of Amazon also left their positions, according to a New York Times report.

Across U.S. business, politics and popular culture, men in powerful positions have faced accusations of sexual misconduct in recent months.

Marija Kramer, head of responsible business investment at proxy advisory firm Institutional Shareholder Services, or ISS, told S&P Global Market Intelligence in an email that investors were more interested in knowing about such accusations in the business world during 2017 than they had been in previous years.

So far this year, ISS-Ethix, the company's responsible investment division, has counted 55 sexual harassment controversies among S&P 500 companies, up from 24 in 2016.

ISS-Ethix is promoting a new set of data that tracks such incidents, the company confirmed to S&P Global. The data offers investors insight into charges of sexual assault and similar allegations by collecting information from court filings, news articles and other sources.

"Over the course of 2017, we've seen a growing number of institutional investor clients inquire about data on sexual harassment" as part of broader analyses of companies in their portfolios, Kramer said.

In the Price case, CtW alleged, Amazon exposed itself and investors to risk by failing to deal with allegations for roughly two years after the company reportedly learned about them.

Failing to handle sexual harassment allegations "threatens both companies' operations and public reputation," CtW wrote in its letter.