This year there have been eight global, regional, and local indexes that have attempted to measure the most LGBTQ+ friendly environments in the corporate world.
Yet, none of these indexes include criteria on the environment, labor, racial or gender diversity, or fiscal transparency, which blindside employees, consumers, and investors. Similarly, on the LGBTQ+ inclusion question, none of these indexes measures LGBTQ+ representation in the executive committee or boardroom at this point (the Corporate Equality Index (CEI) might start including Board diversity in 2023). Nor do these indexes measure the amount of philanthropic engagement with the LGBTQ+ movement.
The example of the pharmaceutical company Gilead Sciences is interesting. Gilead scored 100% for the fourth consecutive year on the HRC Equality Index, is afforded Silver Small Employer status by the Australian Workplace Equality Index (AWEI), and is ranked with an “AA” score by the MSCI ESG index. Gilead is not listed in the Stonewall Top 100 Employers, India Pride Circle, South African SAWEI, or the Community Business Index.
Yet, the company is embattled in a lawsuit with LGBTQ+ activist Peter Staley on the basis that they allegedly attempted to establish a monopoly in HIV treatment by agreeing to combine their antiretroviral medications into exclusive coformulations. Similarly, their nine-person board is entirely straight/cisgender. The company does not collect data or disclose the sexual orientation and gender identity of their Board members in their proxy statements despite it being considered best practice. Can they, therefore, be considered 100% LGBTQ+-friendly?
Concretely, indexes could start by adding three dimensions to their scoring system: i) LGBTQ+ human rights impact, ii) inclusive governance, and iii) amount of philanthropic engagement with the community.
A helpful additional step would be to present scores alongside results of other ESG indexes (such as Bloomberg’s Gender Equality Index or the MSCI ESG rating to ensure employees, consumers, and investors get the complete picture and avoid the obvious risk of pink-washing attempts by the private sector.
In an ideal world, all indexes would share a similar methodology and split the companies by geographical area, based on the headquarters location, to avoid overlap and confusion among companies. A plethora of indexes with diverse methodologies, divorced from other sustainability indexes, run the risks of making corporate accountability even more difficult.