Diversity and inclusiveness
We believe diversity and inclusiveness (D&I) in our organisation is important and it is therefore one of our material topic of good employment practices. We are convinced that diversely-composed teams are more complementary and deliver better results, which contributes to the realisation of our vision and strategy. The more diverse the employees in an organisation, the more talent and competencies it has at its disposal. That makes the organisation stronger, more flexible and effective.
Within the context of the diversity policy of PGGM N.V. (Diversity of Thinking), PGGM Investments has drawn up an action plan which is further targeted towards the challenges faced by PGGM Investments. The participation of PGGM Investments at the PGGM Diversity Board is done by the COO. This board monitors the progress of increasing diversity at PGGM Investments and shares common practices within the business units.
To get a better understanding of the D&I and the perceptions of the employees, PGGM Investments has done a survey together with Edge. Most important recommendations was the improvement of visible commitment of the management regarding D&I and awareness regarding the composition of important project groups. PGGM Investments as a business unit has performed well regarding the cultural diversity. We attract employees from around the world which means cultural diversity is well represented at PGGM Investments. The day-to-day language in a great many front-office teams has therefore become English. The challenge faced still concerns the issue of gender diversity and equality. At the end of 2021, still only 25% of the working force of PGGM Investments are women. Part of our approach is aimed at increasing the number of women in influential positions. We have set ourselves the goal of increasing the percentage of women in management positions to at least 30% by 2023. The percentage of women in management positions was 21% at the end of 2021 (27% in 2020). The percentage of women in positions in grade 11 and up is 19% (19% 2020). The weakened gender balance can be attributed to advancements within PGGM Investments through promotion. In the years to come, attention will continue to be paid to improving the gender balance at scale 11 and above, which is our talent pool for future management roles.
PGGM Investments pursues a conscious recruitment and selection process in which the aim is to ensure that at least half of the candidates for management positions are women. Awareness is created among managers by enriching the management programmes with D&I training. In order to create awareness and stimulate inclusive thinking among the whole organisation, PGGM Investments organises the Stratego workshop for women. The PGGM Investments Academy also offers different workshops on dealing with cultural differences and bias training courses for employees. In the second half of 2021, all managers have participated at the unconscious bias training.
The current composition of the Board of Directors satisfies the requirements for a balanced distribution of seats from the Dutch Governance Code, as this applied until 1 January 2020 (at least 30% of seats are held by women and at least 30% by men). In the current composition 33% of the seats of the Board of Directors are held by women (1 out of 3 seats). Daniëlle Melis has been appointed to the Supervisory Board, replacing Roderick Munsters, from 1 April 2022. She will join a three-member supervisory board, in which 33% of the seats of Supervisory Board are held by women (1 out of 3 seats).
This topic is also important in our clients’ investments. Questions have been added to the questionnaires for external manager selection and attention is now more explicit. We also confront organisations in which we invest on behalf of clients on this topic.
Private equity: data dilemma when driving diversity, equity and inclusion
Diversity, equity, and inclusion (DEI) has been a focus area of ESG integration by the private equity team for several years, encouraging its GPs to take steps to measure and report their initiatives. While historically the focus was mainly on gender diversity, we decided to explore options to broaden the scope and include other important DEI metrics like ethnic diversity. The urgency to take this step stems from within the industry and was emphasised by the Black Lives Matter movement. To help building momentum around the advancement of DEI, we signed up to Institutional Limited Partners Association’s (ILPA) Diversity in Action initiative.
As we firmly believe that reporting can drive change (‘what gets measured gets managed’), our preferred approach was to include ethnic diversity data at the GP and portfolio company level using ILPA’s template. However, it quite quickly became clear that while perfectly normal (and often required) in the US, processing of personal data revealing racial or ethnic origin is prohibited in the Netherlands under GDPR. They are considered sensitive data. Because of this, we decided to look for alternative metrics that enable us to set clear and meaningful targets covering our total portfolio, without processing sensitive information.
We found a simple and hopefully effective metric in asking our GPs to report whether the individual portfolio companies have DEI policies in place.
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