The flexible office startup WeWork told its 6,000 employees last week that it would no longer pay for any red meat, poultry, or pork at company events or allow employees to expense meat meals, Bloomberg reported:
In an email to employees this week outlining the new policy, co-founder Miguel McKelvey said the firm’s upcoming internal “Summer Camp” retreat would offer no meat options for attendees. “New research indicates that avoiding meat is one of the biggest things an individual can do to reduce their personal environmental impact,” said McKelvey in the memo, “even more than switching to a hybrid car.” Individuals requiring “medical or religious” allowances are being referred to the company’s policy team to discuss options. A WeWork spokeswoman confirmed the contents of the memo.
Other startups have adopted no-meat policies, but these companies are predominantly makers of health and lifestyle products, which attract a specific set of customers and employees whose values and interests align with those policies. WeWork, by comparison, is a growing player in the global commercial real estate business with offices in 76 cities around the world. As such, Felix Salmon comments at Slate, the policy of banning meat (but not fish or eggs) at company-provided meals will likely “cause a ridiculous amount of agita for its frontline staffers and, especially, the benighted HR folks tasked with enforcing the policy.” He also criticizes the policy as internally incoherent when measured against its own stated purpose:
It bans lamb, for instance, and it bans chicken, but it doesn’t ban eggs. Eggs cause just as much environmental damage as chickens do, and much less than lamb does. It’s hard to see much environmental logic in a policy that’s fine with factory-farmed salmon but that forbids people from eating pigeon. (There are far too many pigeons in the world, eat as many as you want.)
At the Harvard Law School Forum on Corporate Governance and Financial Regulation, Institutional Shareholder Services Executive Director Subodh Mishra recently published a summary of an ISS analysis of 450 proposals filed at Russell 3000 companies, which shows how investors’ priorities are shifting toward social, political, and environmental concerns. More than two thirds of these proposals are related to social or environmental issues, chief among them political activity and spending, board and workplace diversity, and climate change and sustainability, Mishra writes. Furthermore, nine of the ten most common types of proposals related to one of these issues, whereas only one (demanding the right to call a special shareholder meeting) is focused on governance. Mishra sees two main factors driving this trend:
First, social and environmental issues themselves are gaining significant traction with investors and the public. Important issues, such as concerns about the transparency of the political process, harassment and equity in the workplace, and climate change risks make headlines and dominate the public discussion daily. At the same time, investors and asset owners are bolstering their efforts towards greater ESG integration, which helps proponents gain further momentum. Second, governance topics may be lower on the agenda for the target universe. Shareholder proposals are typically filed at large-capitalization companies, where many formerly-contested governance issues have now become the standard. Annual director elections, majority vote standard, simple majority vote requirements and even proxy access—to a large extent—are now the norm for the vast majority of large companies.
ISS’s analysis counts proposals related to diversity and inclusion toward its total of “social issue” resolutions; while that’s fair, investors are paying more attention to diversity not only out of a sense of social responsibility but also as part of the investor community’s growing concern with talent as a key driver of business value.