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Home Depot and the 23-Year Resolution

Values-Aligned Investing
May 27, 2021

For 23 years, shareholders held votes on whether Home Depot should disclose the EEO-1 forms it files annually with the US Equal Employment Opportunity Commission and describe the most basic data on its workforce diversity. As other large companies scramble to disclose data on DEI (diversity, equity, and inclusion), Home Depot has finally agreed to implement the resolution.

We often tell our clients that pursuing change through shareholder engagement can be a slow process. There may be dozens of dialogues between management and shareholders; public companies pivot like glaciers; and shareholder voting at the annual meeting happens, well, once per year.

Rarely does “slow” mean 23 years.

In 1997, a group of investors—Calvert, Franklin Research and Development (now Trillium), and Boston Trust—filed a shareholder resolution asking Home Depot to publish its EEO-1 form. (This government-required form reports company workforce diversity statistics.) The resolution noted that Home Depot had just settled a large class-action sex-discrimination lawsuit and that transparency would help investors monitor the company’s record of hiring and promoting women and minorities.

Home Depot refused, and investors returned the next year. And the year after that. The resolution eventually changed hands to the Benedictine Sisters of Boerne, Texas, but the request stayed the same for 23 years.

In 2021, Home Depot said yes.1

This agreement did not happen in a vacuum. As the nation has been rocked by social justice protests, large companies have begun to make statements in support of racial justice and DEI. Some stakeholders have pushed companies to put those words into action.

One action that companies can take is disclosing their diversity data. As my colleagues wrote in November, disclosure by itself does not change behavior, but it is part of the accountability process. As recently as last July, just 31 public companies, of which 14 were in the S&P 100, disclosed their full EEO-1 reports.2

A shareholder advocacy campaign focused on EEO-1 disclosure has generated commitments from 52 additional S&P 100 companies since last summer.3 As part of this campaign, Aperio clients have stepped forward to sponsor 26 diversity disclosure resolutions, several of which have been withdrawn in recognition of company commitments.4 Entering proxy season—roughly April through early June, when most US companies have their annual meetings—approximately 15 more EEO-1 resolutions are likely to go to a vote. Dozens more resolutions are asking companies to take actions that go beyond disclosure to demonstrate their commitment to DEI, such as consumer brands reporting on their use of prison labor, pharmaceutical companies using more people of color in drug trials, and financial institutions performing racial equity audits.5

The Home Depot resolution predates my experience in shareholder advocacy; truly, I am not much older than this resolution. To me, the 23 Home Depot EEO-1 resolutions provide a constant point of reference for viewing a society changing around them.

Sometimes change feels linear; sometimes it doesn’t feel that way at all. For example, the vote result climbed steadily for two decades, from 14.4% in 1998 to 26.0% in 2010 to 35.8% in 2020.6 Other trends don’t seem as clear. In 2001, per that year’s resolution, Home Depot began providing EEO-1 information to investors upon request. Several years later, the company reversed that policy.

Source: Home Depot Form 8-K filings

And some things didn’t change much at all. The 1997 resolution claimed that 100 major American companies published EEO-1 forms. The 2011 resolution name-checks a handful of major companies. Last summer, the list of companies disclosing EEO-1 was very short—until all of a sudden, it wasn’t.

One final scene sticks with me, as I sift through financial filings from the ’90s that few read at the time. In response to the 1998 resolution, Home Depot initiated a no-action challenge at the US Securities and Exchange Commission (SEC), a relatively common practice. The SEC allowed the company to omit the proposal and avoid a shareholder vote; however, Home Depot “voluntarily decided to give stockholders the opportunity to respond to this proposal.”7 In 2021, it seems unlikely any company would follow this pattern of obtaining relief from the SEC and then including the shareholder resolution anyway. Perhaps public companies are becoming more responsive to stakeholder concerns in general, but in my experience, companies that file regulatory challenges are serious about avoiding shareholder votes.

After 23 years, shareholder advocates are dusting off their hands and stepping back from their work. A new window has been added to corporate headquarters, but like home improvers everywhere, shareholder advocates know this isn’t their last project. For one reason, Home Depot can continue to expand its disclosures about DEI. For another, despite the flurry of new disclosures, many other companies have not taken that first step and published their EEO-1 data.

What comes after EEO-1? That form does not tell us about diversity demographics beyond gender and race, such as disability or sexual orientation. It does not tell us (very much) about hostile workplaces or discrimination. And, most important, DEI represents societal issues that will require action far beyond the hiring and promotion practices of individual companies to redress.

However, disclosure is important because we cannot manage what we do not measure. Society will soon have access to much more information on race and gender diversity in corporate America. This information may drive new expectations from investors—and that might happen quickly.

See all Aperio DEI blogs.

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1 Home Depot partly implemented the resolution in 2018, releasing gender and diversity statistics for its US workforce. Home Depot stated that this format “better align[ed] to our organization’s titles and reporting structure than the EEO-1 categories.” Investors requested the EEO-1 form itself be disclosed.
2 According to Proxy Preview 2021.
3 Ibid.
4 See our info sheet for more information on Aperio’s Shareholder Advocacy program.
5 Proxy Preview 2021, 8–9.
6 Home Depot Form 8-K filings.
7 Home Depot Form DEF 14A (definitive proxy statement) dated April 17, 1998.


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