Companies are committed to transparency — even as other DEI priorities are questioned

The corporate reckoning that followed the 2020 murder of George Floyd has led to a historic new era of transparency. Just three years on, most of the largest U.S. companies are sharing data on the race and gender makeup of their workforce — information that many of them previously only gave privately to the federal government. Despite the recent debate over the future of diversity efforts in American workplaces, experts expect the recent trend for openness to continue.

In October 2020, when we first started asking S&P 100 companies to release the data that they submit to the U.S. Equal Employment Opportunity Commission, just 25 of them agreed. This year, some 97 of those companies provided their most recent data, either in filings, on their websites, or directly to Bloomberg News. Two more have agreed to do so in the next couple of years.

The information they disclosed formed the basis for a landmark Bloomberg News investigation into hiring across the U.S. as companies moved to address stark racial imbalances in their workplaces.

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"The ball's rolling downhill and I don't see much changing because it's not just investors and activists that are pushing for this," said Josh Ramer, chief executive officer and founder of DiversIQ, a company that tracks and analyzes the submissions made via EEO-1 forms. "Transparency is really important to people so that they can judge for themselves. 'Do I want to work for this company? Do I want to do business with this company?'"

Among the broader S&P 500, 375 companies are already sharing the data and another 12 have committed to start doing so, research by DiversIQ found.

In the months after George Floyd's murder by police, many of the biggest companies in the U.S. made public promises to diversify their workforces and bolster their support for members of underrepresented communities. The inequities brought to the fore by that summer's protests — as well as the disproportionate toll of the COVID-19 pandemic on minority communities — also prompted investors to demand more transparency from companies, including demands to release their EEO-1 forms. 

Some version of the form has been collected for companies with 100 or more workers since 1966, after it was included in the 1964 Civil Rights Act. The form mandates that companies break down their workforce by seven racial and ethnic groups and by gender, and then divide them among 10 job categories, from executives and managers through to service workers and laborers.

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It's the only collection of this data at a federal level and is used by the government to create a picture of the national workforce and look for disparities in hiring. While companies can't be forced to disclose the forms under freedom of information requests, many have been increasingly willing to offer it voluntarily. 

Still, there's been concern that a fierce debate over corporate diversity, equity and inclusion programs could derail company openness after the U.S. Supreme Court ruled in June that universities cannot use affirmative action to pick students. Republican attorneys general from 13 states wrote an open letter to Fortune 100 companies in July warning them that hiring practices with specific goals for minority workers could also be subject to lawsuits. 

Bloomberg News collected most of the EEO-1 data prior to the Supreme Court's ruling. None of the half-dozen companies with the most notable diversity gains wanted to discuss them in detail.

Companies that have made the move to start sharing their data are unlikely to stop doing so, said Thomas Bourveau, an associate professor at Columbia Business School who has studied the relationship between a company's disclosure of EEO-1 data and its DEI credentials.

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"Once a company has started to disclose their EEO form publicly, they keep doing it year after year," said Bourveau. "It creates a virtuous circle because it forces you to act — to maintain or ideally improve on those dimensions."

As more data is made public it'll be easier to measure progress among big companies, said Alison Omens, chief strategy officer at JUST Capital, a research group that pushes for corporate transparency. The group has been asking companies about EEO-1 data since 2019, she said. Initially, the goal was just to see how many companies were willing to be transparent. Now that the forms are available in sufficient quantities, it's possible to also gather comparative data, she said.

"Over the next year or two we will see which companies understand and invested in this topic as it connects to their business strategy, and which ones didn't," Omens said.