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Activist investor wants outside review of Comcast's 'failures to prevent workplace sexual harassment'

Christian Hetrick, The Philadelphia Inquirer on

Published in Business News

An activist investor with a track record of drawing attention to gender discrimination issues at large companies has called on Comcast to conduct an independent investigation into the company's "failures to prevent workplace sexual harassment."

Arjuna Capital, based in Boston, filed a proposed shareholder resolution asking Comcast for an independent review and a report on such failures, citing the need to avoid legal and reputational risk.

Comcast wants to exclude the proposal from resolutions that shareholders would get to vote on at its annual shareholder meeting, typically held in June. The Philadelphia media giant argues the proposal deals with the company's ordinary business operations, which is outside the purview of shareholders, according to a Jan. 31 letter it filed with the U.S. stock market regulator Securities and Exchange Commission.

Arjuna Capital's proposed resolution cites NBC's 2017 firing of former Today show host Matt Lauer over sexual harassment claims and questions about how NBC News has handled workplace sexual misconduct, among other things. The proposal said a report should assess how the company could better hold employees accountable when they cause harm.

The firm, which describes itself as a "sustainable and impact investment firm" that works with wealthy individuals and institutions, said it represents investors owning more than 1.4 million Comcast shares. Comcast has a total of 4.6 billion shares.

Natasha Lamb, a managing partner at Arjuna Capital, said in a statement that investors are concerned about the possibility of regulatory fines and court-imposed judgments. The firm's resolution cited a $3 billion loss in the market capitalization of Wynn Resorts over two days following harassment allegations against CEO Steve Wynn. Lamb said Comcast's intent to exclude the resolution before it can reach an investor vote is "not a credible corporate response."

 

"On its face, the decision by Comcast/NBCUniversal to kill our sex discrimination resolution before it reaches an investor vote suggests they just don't get it," Lamb said.

Comcast declined comment, beyond the SEC letter.

In the SEC letter, an attorney for Comcast cited SEC rules that allow companies to omit shareholder proposals if they deal with the company's ordinary business operations. The SEC has said the policy is meant to confine ordinary business problems to management and boards of directors, "since it is impracticable for shareholders to decide how to solve such problems at an annual shareholders meeting," according to the letter from Comcast's lawyer, William Aaronson, of the Davis Polk law firm in New York.

The letter also said Comcast has revised policies related to sexual harassment allegations and enhanced workplace training in 2017 and 2018.

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