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Gentex Rebuffs Diversity Mandate
Fifty-six percent of the shares that were cast at Gentex’s annual meeting were against the proposal from the Calvert Social Index Fund, a fund that has $28.7 million in assets and holds 428 shares of Gentex stock.
The Calvert Social Index Fund, part of broader socially responsible Maryland-based investment group that manages $8.6 billion in assets, asked Gentex shareholders to back a resolution that would have required the corporation’s board of directors or nominating committee to “take every reasonable step to ensure that women and minorities are a routine part” of every search the company takes in the future for new directors. The fund argues that diversity generates more independence and a broader array of views among corporate boards.
Gentex directors, while agreeing with the principles behind it, opposed the proposal, saying the company already embraces diversity and requiring an annual report on the issue would have been a burden. The proposal also would have detracted from finding “the best qualified candidate” for boards seats when a vacancy comes open, Chairman and CEO Fred Bauer said.
Diane White, head of the corporate board diversity initiative for the Calvert Group that includes the Calvert Social Index Fund, said the investment group would continue to press its case with Gentex.
“We’ve had some very good dialogue with them. This is the beginning,” White said.
The Gentex proposal is one of several Calvert filed this year with companies whose shares it owns. As a socially responsible investment fund, the Calvert Social Index Fund is merely acting on a core principle of promoting gender and racial diversity among the boards at companies in which it invests, representatives have said.
“You have to be proactive and have a plan in place, or the good intentions just don’t materialize,” White said.