NYC Pension Funds Seek Board Demographics From NextEra Energy, GameStop

New York City Comptroller Brad Lander and three of the city’s five public pension funds have filed shareholder proposals at energy company NextEra Energy Inc. and gaming retailer GameStop Corp., asking that the companies’ board members disclose their self-identified race, gender, relevant skills and attributes.

The proposals argue that a diverse board enhances discussions and decisionmaking while improving transparency and accountability, as well as corporate performance and long-term shareholder value. They also contend that a diverse and experienced board is better equipped to navigate and mitigate potential risks. In particular, the NextEra proposal explicitly requests disclosure of director skills relevant to climate-change risks.

“Carbon-based sources account for roughly half of NextEra’s generating capacity, underscoring the need for a climate-competent board to oversee NextEra’s transition to a low-carbon economy,” the proposal says. “A board matrix would enable investors to make better informed proxy voting decisions by providing them with consistent, comparable and accurate data concerning NextEra’s directors in a structured, decision-useful format.”

With regard to GameStop, the pension funds’ proposal states that the company’s 2023 proxy statement “provides little decision-useful data with respect to how its directors’ individual qualifications fit together to effectively fulfill the board’s oversight.”

The proposals are part of the New York City Office of the Comptroller’s Boardroom Accountability Project 2.0, launched in 2017 to increase transparency, expand diversity and strengthen board oversight. As part of the project, the city comptroller’s office and pension funds aim to file board diversity proposals at companies, as well as engage with portfolio companies to advocate for best practices in corporate governance.

“Investors believe a diverse board—in terms of relevant skills, gender, and race/ethnicity—is an indicator of a well-functioning board,” both proposals stated. “Among other benefits, diverse boards can better manage risk by avoiding groupthink.”

According to the comptroller’s office, it has already secured agreements under the initiative with Hilton Worldwide, Marriott International, BlackRock, Goldman Sachs, PepsiCo and Exelon to publicly disclose a board matrix.

“When it comes to protecting shareholder interests and upholding the principles of transparent and accountable corporate governance, empowering shareholders with detailed insights into the skills, experience, and diversity of board nominees becomes paramount for sustained long-term value,” Lander said in a statement. “This underscores the broader need for transparency and genuine commitment to diversity and inclusion, ensuring a pathway to long-term shareholder value through authentic representation and equity in corporate leadership.”

The three pension funds that filed the proposals—the New York City Employees’ Retirement System, the Teachers’ Retirement System of the City of New York and the New York City Board of Education Retirement System—collectively own approximately $210 million worth of NextEra Energy shares and $4.2 million worth of GameStop shares, as of the beginning of the year.

Lander and the three pension funds also said that after shareowner engagements with the boards of Dollar Tree, Grocery Outlet Holding, and Mattel, that the companies agreed to disclose annual workforce diversity data. They also said they filed a proposal at DICK’s Sporting Goods requesting the same disclosure.

As of the end of 2023, the three systems collectively owned $28 million worth of Dollar Tree shares, $2.4 million worth of Mattel shares, $445,694 worth of Grocery Outlet shares, and $26.9 million worth of DICK’s Sporting Goods shares.