February 05, 2007
Proxy Votes on Sexual Orientation Nondiscrimination Draw Strong Support
by Anne Moore Odell
Shareholder resolutions calling for equal rights for all employees at Commercial Metals and Micron
highlight growing support for companies to include sexual orientation in their nondiscrimination
Two recent shareholder resolutions asking for sexual orientation to be added to companies’
employment nondiscrimination policies met with great success. Micron Technology (MU) revealed on January 10, 2007 in their 10-Q that 55% of
shareholders supported an amended policy in a recent proxy vote. Commercial Metals (CMC) shareholders supported 43% in
favor to unequivocally add sexual orientation to their Equal Employment Policy.
These two companies are part of a minority of companies that still don’t have inclusive
nondiscrimination policies. The Human Rights
Campaign reports that over 85% of Fortune 500 Companies have policies that are inclusive of
sexual orientation. Although there is no federal law protecting employees from discrimination based
on sexual orientation, sixteen states and over 130 cities have passed laws that require companies
to protect workers from discrimination based on sexual orientation.
Micron, a maker of
semiconductors, is based in Boise, ID. Micron’s nondiscrimination resolution was filed by the New
York City Employees' Retirement System (NYCERS) and was moved at its
annual meeting by Zack Wright, board member of the Pride Foundation of Seattle, WA.
resolution states that "corporations with non-discrimination policies relating to sexual
orientation have a competitive advantage to recruit and retain employees from the widest talent
pool. Employment discrimination on the basis of sexual orientation diminishes employee morale and
productivity." The Board of Directors recommended voting against the resolution as discrimination
based on sexual orientation is not a federal law.
"We were surprised that we got more than
50% of the vote." Wright of the Pride Foundation told Socialfunds.com. "Micron has already had
time to respond to the vote. It doesn’t take a lot of time to add a couple of words to a policy. It
seems a bit arrogant that a company would go against the vote of its shareholders."
of gay employees are afraid to come out at work for fear of losing their jobs," Wright added. "It
would be great to have a nondiscrimination policy in place for the Micron employees."
Micron strictly prohibits discrimination and harassment, the company said, with training
programs in place to help identify and stop discrimination. Daniel Francisco, Micron spokesman told
SocialFunds.com, "We do not allow harassment of any kind. We respect the shareholder vote, and
given this, management is evaluating an appropriate response. Specifically, Micron management is
evaluating appropriate changes, if any, to its existing policies in response to the shareholder
Management was the lead filer at Commercial Metals, headquartered in Irving, TX. Pat Tharp of
the Social Action
Council of Dallas, TX, formally moved the resolution at CMC’s annual meeting. Commercial Metals
is a metals manufacturer that manufactures, recycles and markets steel and metal products around
Like Micron, CMC management stressed that the company does not tolerate
discrimination of any form, including sexual orientation. However, as sexual orientation is not a
protected under federal law, CMC management does not support the amendment at this time.
David Sudbury, Senior Vice President, Secretary & General Counsel for CMC added, "Approximately
57% of the shareholders voting, a majority, did not support the proposal to amend the existing
policy. The Company will continue to monitor both the application and effect of the existing
policy and take such steps, if any, that it considers appropriate."
Research Associate with Walden Asset Management commented to Socialfunds.com, "It is hard to
predict how CMC will respond to the vote. However, with the exception of Micron, whose vote totals
were also announced in January, no other company has received such a definitive positive vote on
this issue and continued to hold a non-inclusive policy."
ExxonMobil is one the biggest
companies not to include sexual orientation in its nondiscrimination policies. ExxonMobil faces a
resolution addressing this issue in the upcoming proxy season. Support for this resolution at
ExxonMobil has risen steadily from 13% in 2001 to 34.6% in 2006.
Cracker Barrel gained
notoriety and media attention after ten years of proxy votes about including sexual orientation as
part of their nondiscrimination policies. And in 2002, Cracker Barrel got a 58% shareholder vote in
favor of adding sexual orientation to its nondiscrimination policy.
Many companies have
added sexual orientation to their nondiscrimination policies before shareholder resolutions were
put to proxy vote. For example, in 1997 McDonald’s worked with the Pride Foundation to make a
written policy barring discrimination based on sexual orientation.
resolutions are prefatory, management of Micron and CMC will need to respond. While most social
issue proxies receive between 5% and 15% of the vote, a 43% and 55% vote shows the support that
shareholders have on this issue. If sexual orientation isn’t added into their nondiscrimination
policies this year, both Micron and CMC can count on another similar resolution being brought up in
the next proxy season.