The Church of England has threatened to disrupt shareholder meetings of companies it funds if they fail to increase the ethnic diversity of leadership teams.
Letters will start going out next month listing its demands to some companies in the fund’s investment portfolio, according to The Guardian.
The Church Commissioners was founded in 1948 and exists to “support the work and mission” of the Church of England, according to its website.
It is accountable to Parliament, the General Synod and the Charity Commission.
“We manage an £8.7bn investment fund in a responsible and ethical way, using the money we make from our investments to contribute towards the cost of mission projects, dioceses in low-income areas, bishops, cathedrals, and pensions,” it states.
In 2019, the Commissioners gave £117.6m to the Church of England.
Bess Joffe, the Commissioners’ new head of responsible management, told The Guardian the fund would cast protest votes at annual shareholder meetings if companies do not comply with their demands.
“I think you’ll see some vote impact as early as 2021. But of course it’s not going to be taking companies off guard – we will be communicating our expectations in the next four to six weeks,” she said.
The Commissioners previously voted against companies which had poor environmental policies and no female board members, including Prudential’s board due to its “unacceptably low” number of female members.
Companies among the fund’s investments include Facebook, Tesco and pharmaceutical giant AstraZeneca, as well as London’s Hyde Park Estate.
Ms Joffe told The Guardian: “Ethnic diversity has not been a priority in any real way for companies.
“They have to play their part in improving the lives of people who have been disenfranchised and left behind and who are going to suffer [disproportionately] as a result of Covid.”
She added that there is a desire for boards of directors, management teams and “pipelines of talent” to “look like the communities in which they exist”.
Ms Joffe joined the Commissioners in August 2020 after previously holding positions at Lloyds Banking Group, Goldman Sachs and Hermes Equity Ownership Services.
Upon joining the group she said: “I am proud to be joining the Church Commissioners at this exciting time. Real change is starting to be seen thanks to the efforts of responsible investors and I am pleased to be joining a proactive organisation which recognises the challenges facing our world. I look forward to working with the team to build further on their successes.”