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As Court Threatens to Nix Roe v. Wade, Companies Face Shareholder Votes on Reproductive Rights

For Lowe’s, Walmart, and TJ Maxx, abortion access is critical to attracting employees, some investors say.

As the U.S. Supreme Court reportedly readies to overturn Roe v. Wade, the landmark decision that guaranteed the right to an abortion, companies are being asked by shareholders to ensure reproductive health benefits for their employees. Three major companies face shareholder proposals on reproductive rights in the coming weeks, including TJX Companies TJX (TJ Maxx), Walmart WMT, and Lowe’s LOW.

Companies that already have taken steps to ensure access to abortion specifically cite their expectation that it will reduce risk and make them more attractive to future employees. More companies may take action.

Because abortion is such a hot-button issue, many companies are struggling with their responses. At least 31 companies have publicly moved to support employee access to abortion, according to an informal survey by Rhia Ventures, an investor in reproductive healthcare, but this is a drop in the bucket.

Yet, doing so is in line with the tenets of so-called stakeholder capitalism, a form of capitalism that grounds a company’s long-term success in its equal attention to stakeholders—such as employees, suppliers, customers, and community—and shareholders. Stakeholder capitalism is endorsed by the influential Business Roundtable.

"We see this as an issue to attract and retain talent," says Kathy Gasperine, a commercial banker specializing in social impact at Amalgamated Financial AMAL. Amalgamated told employees that it will cover travel expenses for workers and dependents who need to travel out of state to access reproductive healthcare, including airplane fare or gas money, hotel and meal expenses, as well as childcare for children remaining at home.

The bank’s foundation will also help fund organizations responding to what it calls an “abortion access crisis.”

Meanwhile, Levi Strauss LEVI said that its employees, 58% of whom are women, are eligible for reimbursement for healthcare-related travel expenses for services not available in their home state, including those related to reproductive healthcare and abortion. In an interview with CBS, Bank of America BAC CEO Brian Moynihan said the bank would assemble a team of employees to discuss what it could do if Roe v. Wade were struck down.

Retailers Asked to Detail Company Risks Related to State Abortion Restrictions

Lowe’s annual meeting is on May 27, Walmart’s is on June 1, and TJ Maxx’s is on June 7.

Jonas Kron, chief advocacy officer at Trillium Asset Management, which sponsored the TJ Maxx proposal, said it was “really important” to file the shareholder proposal this year because “it became quite clear in the fall that the threat to reproductive rights had grown significantly. We needed to try to raise these issues through a shareholder proposal.” If the Supreme Court overturns Roe v. Wade, a number of states have so-called trigger laws to ban abortion, and a number of other states are expected to move to severely restrict abortion.

The proposals at TJ Maxx, Walmart, and Lowe’s were crafted in part by Rhia Ventures and are similar. They ask the companies to publish reports detailing risks and costs to the company caused by state policies that severely restrict reproductive rights. They ask the companies to detail strategies, beyond litigation, that they might use to mitigate these risks. The proposals recommend that the company boards look into the effects on worker hiring, retention, and productivity and also decisions regarding closing or expanding operations in states with restrictive laws. (Rhia has also filed proposals connected to political spending.)

Lowe’s, Walmart, and TJ Maxx all recommend voting against the proposals.

The retailers’ outlets dot the United States. The proposal for Lowe’s, filed by Educational Foundation of America, a family foundation, notes that the retailer’s home state of North Carolina once had a law that outlawed all abortions within the state. If revived, “Lowe’s may find it difficult to recruit employees to North Carolina, or to the 20-plus states now considered likely to outlaw abortion if Roe is overturned … This may harm its ability to meet diversity and inclusion goals, with negative consequences to performance, brand and reputation,” according to the proposal. Meanwhile, the Walmart proposal, filed by Clean Yield Asset Management, notes that Arkansas, where Walmart is headquartered, is likely to outlaw abortion entirely if Roe is weakened or overturned. Indeed, it notes that 60% of Walmart’s stores are in states that “could immediately prohibit abortion entirely.”

With 39% of Lowe’s Employees Women, Shareholder Urges Investors to Support Proposal

In a forthcoming letter to Lowe's shareholders, shared with Morningstar, Educational Foundation of America urged shareholders to vote for its resolution, noting that legislative and judicial developments have weakened access to abortion care in states where Lowe's has operations, with 26 states "certain or likely" to ban abortion outright. Lowe's has stores in all 50 states and has 300,000 employees, 39% of them women. The letter cited a 2019 survey that found some 90% of women said that controlling if and when to have children was important to their careers. It also said that 83% of women in child-bearing years want employee health insurance to cover the full range of reproductive healthcare.

Lowe’s opposes the proposal, saying that it’s “framed in such a broad manner” that it would be difficult to create a useful report. However, the EFA asserts that Lowe’s will face new challenges related to hiring, retention, productivity, and other matters, “including higher turnover in states with extreme abortion restrictions.” Moreover, Lowe’s position presents threats to employee well-being, health, morale, corporate reputation and brand, consumer loyalty, and the attainment of its diversity and inclusion goals, it said.

“All eyes are on the corporate sector now with every aspect of this development,” says Shelley Alpern, director of corporate engagement for Rhia Ventures. “We have been warning companies that this day will come.”

Adds Alpern: “Our game plan is to continue calling on companies. We’ve always emphasized the need for them to talk to lawmakers and tell them that extreme abortion restrictions create a terrible business environment that is harmful to their employees and harmful to them by extension.”

The author or authors do not own shares in any securities mentioned in this article. Find out about Morningstar’s editorial policies.

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