Citigroup, Wells Fargo and Bank of America urge shareholders to vote against racial fairness audits

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Three of the nation’s largest banks are asking shareholders to reject racial equity resolutions after they expressed solidarity with the Black Lives Matter movement last year. Citigroup Inc. C, + 0.37%, Wells Fargo & Co. WFC, + 1.25%, and Bank of America Corp. BAC, + 0.82% were among the many large US companies that made public statements of support in response to the widespread protests last summer. after the police murders of George Floyd and Breonna Taylor. In recent days, everyone has officially opposed calls by shareholder groups 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 banks to examine their practices and policies and identify ways to “avoid adverse impacts on non-white stakeholders and communities of color,” something the banks say is unnecessary because they are juggling different related initiatives and / or have committed money for such problems internally and externally. The proposals are included in statements of power to shareholders, which allow companies to support or oppose shareholder resolutions and explain why before a vote at their annual meetings. For more information: companies declared that ‘black lives matter’ last year, and now they are being asked to prove it. CtW Investment Group wrote in its proposal to Citi shareholders that the bank “has a troubled history when it comes to addressing racial injustice within the communities it serves.” The group provides examples, including that Citi was fined for the Treasury Department in 2019 for not offering all customers discounts and home loans; its required minimum maintenance fees and minimum daily balances; and the fact that it only has one black executive in the C-suite (CFO Mark Mason) “While we disagree with the overall focus of this proposal, we are fully aligned with its stated goal of addressing racial inequality in the financial sector,” Citi said in its presentation Wednesday. The bank noted its commitment of 1,000 millions of dollars to provide greater access to banking and mortgages for communities of color, in addition to investing in black businesses. : “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 also encourages shareholders to vote no on a couple of other resolutions related to racial equity, such as adopting a “Rooney Rule” policy to increase diversity on its board of directors and disclosing its direct and indirect lobbying activities in a report. See also: Women could pave the way for ESG investing in the U.S. 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 proportionally fewer home loans to minorities than to whites. applicants in Philadelphia, and that BofA’s C-suite is only 8% black. Bank of America said in its release published last week that it has committed $ 1 billion to support minority-owned businesses, employment initiatives in black and Hispanic communities, affordable housing and donations to historically black universities and more. He also touted his work with “consumer advocates in the design and marketing of our financial products and services” and his efforts to diversify his workplace and leadership. In its Wells Fargo proposal, Service Employees International Union Pension Plans Master Trust mentions the bank’s history of discriminatory credit practices that have resulted in different lawsuits and a settlement with the Department of Justice in 2012, as well as discrimination claim settlements in the job. . Wells Fargo, which released its proxy Tuesday, said it is conducting a “human rights impact assessment” and will release a summary of those findings and the actions it plans to take in response. The company also said it is making efforts toward diversity, fairness and inclusion in its workplace and among its top ranks. Dieter Waizenegger, CEO of CtW, worked with SEIU on shareholder proposals. While he said he “welcomed” the promises of the banks on issues of justice and racial equality, “as investors, we believe that an essential part of this work is an independent evaluation of the effectiveness of these promises.” Read: This California investor predicts a 10-year ‘good economy’ revolution that shifts the sharing economy aside Shareholder groups had also pointed out that political and charitable donations from banks contradicted their stated commitments to justice and equity. Wells Fargo “has donated to Senator Tom Cotton, who called for military airstrikes in the Black Lives Matter protests, as well as other members of Congress with racist backgrounds,” the SEIU shareholder resolution reads. CtW said that “Citi donated $ 242,000 during the 2020 election cycle to 74 members of Congress rated ‘F’ by the NAACP,” and that Bank of America has been involved in the issuance of “judicial obligation bonds, a portion of which was used to pay for police-related settlements ”in Los Angeles. Both Wells Fargo and Bank of America have donated to police departments that“ circumvent normal procurement processes to purchase equipment for police departments, including technology used to target communities of color and non-violent protesters, “shareholder resolutions say. Goldman Sachs Group Inc. GS, + 0.95%, Morgan Stanley MS, + 1.60%, and JP Morgan Chase & Co. JPM, + 1.03% are facing similar proposals from shareholders and have not yet released their proxy. This article will be updated when they do.