New Gender Justice Investor Data Available from Force The Issue

By: Rachel J. Robasciotti, Founder & CEO

Ending forced arbitration for sexual harassment is a critical step in creating more safe and inclusive workplaces and advancing gender, racial, and economic justice. Forced arbitration favors employers over harassment survivors, creating a culture of acceptance of sexual harassment in the workplace.1 Two years ago, we started Force The Issue, a coalition of investors, workers, and consumers collaborating to end this harmful practice. Together, we made the case for ending forced arbitration for sexual harassment, asked thousands of public companies where they stand, and published the data on this intersectional issue.

 

What is Forced Arbitration for Sexual Harassment?

Forced arbitration requires workers, as a condition of employment2, to sign an agreement that they will only settle disputes with the employer through private arbitration – with no judge, no jury, and almost no government oversight. The practice eliminates the option of going to court and legally prevents the employee from discussing the issue with anyone outside of the arbitration proceedings. Research has demonstrated that arbitration rulings favor employers3 that likely benefit from maintaining ongoing relationships with arbitrators. When valid sexual harassment claims are routinely mishandled and employees are barred from publicly sharing their experiences, companies unintentionally protect serial harassers, silence victims, and create a culture of acceptance regarding sexual harassment.

Why Should Investors Care?

In addition to the clear social harm resulting from this practice, as investors we urge companies to end this practice for the following reasons4:

  • Forced arbitration prevents the public, including investors, from having access to a company’s history of sexual harassment claims and how they were handled.
  • Forced arbitration creates a costly culture of acceptance for sexual harassment.
  • All employees are made more vulnerable by forced arbitration of sexual harassment claims, especially women, African Americans, and low-wage workers.
  • Ending the practice inspires brand loyalty from a generation of socially savvy, values-motivated consumers, which is critical for long-term business success.
  • Ending the practice offers a competitive edge in hiring.
  • Ending the practice is easily done.

But, wait… Isn’t Gender Lens Investing About Women on Corporate Boards?

Yes, traditionally, gender lens investing screens companies by the number of women on the board or in upper management, which is a very narrow slice of women (usually white, upper class, and already wealthy). While this data may be an indicator of a company ready to consider womens’ ideas, this traditional gender screen doesn’t look out for the women most vulnerable to harassment and assault at work.

How is Adasina’s Approach Different?

At Adasina, when we identify new investment criteria, we first ask the communities most impacted by injustice to tell us what issues are important to them. When we talked to survivors of sexual harassment and women’s rights activists we realized the women most impacted were asking for an end to the corporate policy that they felt enabled serial sexual harassment at work – forced arbitration.

Like each of our four investing themes, gender justice is inextricably linked with other social justice issues. By targeting forced arbitration for sexual harassment, our gender justice strategy intersects deeply with issues of economic and racial justice because forced arbitration disproportionately impacts women in lower-paying jobs, and those jobs are staffed disproportionately by Black and Brown women.5

In mid-2019, we set out to end corporate forced arbitration practices that contribute to unsafe workplaces and exacerbate gender injustice. To do this we began reaching out to companies to find out where they stood on the practice, building a database and evaluation tool for investing in public companies, allowing us to launch the industry’s first Sexual Harassment investment screen. In conjunction with this project, Adasina also released a public investor statement6 signed by investors representing over $54 billion in assets calling for an end to forced arbitration.

March 2021 Update

When Force the Issue began its research in fall 2019, only a handful of publicly-traded companies were on the record as not using the practice of forced arbitration. Since that time, Force the Issue has been covered by major media outlets like the Washington Post7, CBS News, the Wharton School8, and Gender-Smart Investing9, and has been amplified by industry leaders like Alyssa Milano and Ellen K. Pao. We have also seen increased awareness on the issue of forced arbitration for sexual harassment, most notably when Wells Fargo publicly disavowed the practice10 in February 2020.

As of March 2021, the Force The Issue database now includes data for over 3,500 public companies, the full scope of regularly traded US public companies, and where they stand on the practice. More than 300 companies now report they do not use the practice of forced arbitration for sexual harassment, impacting more than 10 million employees.

What Can Investors Do?

Use the Force The Issue database to see if you are invested in companies that require arbitration for sexual harassment.

  • Adasina ETF Investors: You’re all set. The Adasina Social Justice All Cap Global ETF (ticker symbol: JSTC) is the first to use this newly available data in our portfolio, so we’re already taking care of this for you. We have chosen to exclude these companies from our fund. More information about the fund is available here.
  • Institutional Investors: If you hold any of these companies, engage with them and demand they end this practice. Ask the companies to take a leadership role in creating safe and equitable workplaces. You can also choose to exclude from your portfolio any companies that continue to practice forced arbitration for sexual harassment.
  • Individual Investors: Ask your financial advisor to review the site and let them know you want to take action in your investment portfolio.

What Can Consumers & Advocates Do?

Use the Force The Issue database to see which companies require arbitration for sexual harassment and:

  • Write letters to companies on the list telling them you want them to end this unjust practice. Email contact information for most of these companies is listed on the database.
  • Choose to shop, patronize, and otherwise give your consumer dollars to companies that do not use this practice.

Want to Know More?
Come gather in community, learn more about the campaign, and discuss ways investors, advisors, and advocates can use this valuable data, and help make workplaces safer for women. March 25th at 11am PST / 2pm EST. Register here to attend.

 

 

 

 

 

 

 

 

 


Endnotes:

  1. Alexander Colvin, “An Empirical Study of Employment Arbitration: Case Outcomes and Processes,” Cornell University (February 1, 2011).
  2. An agreement that requires an employee to opt out of a waiver or take any affirmative action in order to preserve their rights is deemed a condition of employment.
  3. Alexander J.S. Colvin, “An Empirical Study of Employment Arbitration: Case Outcomes and Processes” Cornell University, ILR School (February 2011).
  4. Investor Statement in Support of Ending Forced Arbitration for Sexual Harassment Claims
  5. News from EPI Press Release, “Women and African Americans are More Likely to be Subject to Mandatory Arbitration,” Economic Policy Institute (April 6, 2018).
  6. Investor Statement in Support of Ending Forced Arbitration for Sexual Harassment Claims
  7. Jena McGregor, “New database aims to expose companies that make employees arbitrate sexual harassment claims,” Washington Post (February 27, 2020).
  8. Katherine Klein, “Bridging Social Justice and the Financial Markets,” Wharton University of Pennsylvania (October 23, 2020).
  9. Gender-Smart Investing, “Gender-Smart Investing Journeys: Rachel J. Robasciotti,” Gender-Smart Investing (March 2021).
  10. Ann Marsh, “Wells Fargo ends forced arbitration for sexual harassment claims. Will other firms follow?,” Financial Planning (February 21, 2020).

 


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