State Street Corp, the financial firm known for commissioning the iconic “Fearless Girl” statue, has quietly ended some of its diversity policies. The statue, which once faced down the Wall Street Charging Bull sculpture, had become a well-known symbol of gender diversity in the workplace. Last year, State Street’s proxy voting and engagement policy stated that it expected boards of firms in its index funds to have at least 30% female directors.
The policy warned that State Street might vote against the nominating committee or the board leader if such expectations were not met. However, this year the 30% gender requirement has been removed from the policy. Also missing are the previously established requirements for companies to disclose the gender, racial, and ethnic composition of their board to State Street and outline their diversity, equity, and inclusion (DEI) goals.
Instead, State Street now states that it believes “nominating committees are best placed to determine the most effective board composition.” The company encourages companies to ensure that there are sufficient levels of diverse experiences and perspectives represented in the boardroom. State Street commissioned the bronze Fearless Girl statue in 2017, just before the #MeToo movement gained traction.
State Street adjusts board diversity policies
The statue was intended to advertise a State Street investment fund focusing on companies with female leaders. Initially placed in front of the famous Charging Bull statue on Wall Street, Fearless Girl was later moved to a location outside the New York Stock Exchange, where it has become a popular tourist attraction. State Street ended up suing the artist behind the statue, Kristen Visbal, for breach of contract and trademark infringement after she began selling replicas.
Both parties reached a settlement last year. In a statement, State Street said that it reviews its proxy voting and engagement policy annually “to ensure alignment with global protocols and local laws and regulations, guided by our core principles of effective board oversight, disclosure, and shareholder protection, and a singular focus on value creation.”
The change indicates a broader trend since the Trump administration, which ended DEI policies within the federal government and is reportedly looking into curtailing DEI in the private sector. Companies such as McDonald’s, Target, Meta, and Amazon have publicly announced they are dropping their DEI goals.
However, not all companies are following this trend. Costco and Apple both resisted proposals from conservative shareholder activists that questioned their DEI policies. Nevertheless, American consumers have started responding to companies dropping their DEI programs, as seen in backlash against brands like Target and Walmart.