27 August 2020 Dear Board Chair, As a long-term investor in more

27 August 2020

Dear Board Chair,

As a long-term investor in more than 10,000 public companies across the world, State

Street Global Advisors believes that the single most important driver of long-term value is a

strong, independent and effective board exercising high-quality oversight. In turn, we have

long appreciated the positive correlation among diversity at the workforce and board levels,

effective boards and oversight and sustainable long-term financial performance. As such,

whether through our long-standing stewardship focus on gender diversity and board

effectiveness, amplified by our Fearless Girl campaign, or the integration of Sustainability

Accounting Standards Board (SASB – see Figure 1) diversity metrics into our

Environmental, Social and Governance (ESG) scoring system, R-Factor™

, we have called

on companies to disclose more details regarding the diversity of their boards and

workforces.

The ongoing issue of racial equity has caused us to focus more closely on the ways in which

racial and ethnic diversity impacts us as investors. As such, we are writing to inform you that

starting in 2021, State Street Global Advisors will ask companies in our investment portfolio

to articulate their risks, goals and strategy as related to racial and ethnic diversity, and to

make relevant disclosure available to shareholders.

As long-term investors, we are convinced that the lack of racial and ethnic diversity and

inclusion poses risks to companies that senior managements and boards should understand

and manage. The risks that can arise from having a homogeneous board and workforce are

well understood and drove our focus on gender diversity years ago. Research demonstrates

the tendency for groups composed of people from similar backgrounds to refrain from

challenging prevailing views, as well as the positive impacts that diverse groups can have

on improved decision making, risk oversight and innovation.

Other studies have shown that

management teams with a critical mass of racial, ethnic and gender diversity are more likely

to generate above-average profitability.

Further, companies that promote workforce

diversity and inclusion through transparent hiring, promotion and wage practices have seen

improved productivity,

revenues

and market share.

Likewise, companies with limited

diversity are more likely to underperform their peers

and face reputational risks.

Unfortunately, while companies in the United States are required by regulators to track

racial diversity data, only 4% of Russell 1000 companies publicly share detailed data on

their employees’ gender and ethnicity.

While gender diversity data is generally measurable and comparable among companies

across the globe, our engagements with portfolio companies have revealed that tracking

racial and ethnic diversity is challenging for companies, boards, and investors. Racial and

ethnic diversity may vary significantly across different countries and regions. From a

disclosure standpoint, some countries limit the gathering of information related to racial and

ethnic minorities. In addition, while SASB’s approach to human capital management is

evolving, its current diversity metrics only apply to nine industries.

While we acknowledge these complexities, we also believe it is critical for boards and

investors to have more robust information and data regarding the racial and ethnic

workforce diversity of companies in their portfolios and to understand the steps they are

taking to achieve relevant goals. To this end, we ask that US companies in our portfolio and,

to the greatest extent possible, non-US companies, provide specific communications to

shareholders in five key areas:

1. Strategy: Articulate what role diversity plays in the firm’s broader human capital

management practices and long-term strategy.

2. Goals: Describe what diversity goals exist, how these goals contribute to the firm’s

overall strategy, and how these goals are managed and progressing.

Richard F. Lacaille

Global Chief Investment

Officer

State Street Global Advisors

1 Iron Street

Boston, MA 02210

USA

ssga.com

3. Metrics: Provide measures of the diversity of the firm’s global employee base and

board. For example:

- Workforce- Employee diversity by race, ethnicity and gender, broken down by

industry-relevant employment categories or levels of seniority, for all full-time

employees. In the US, companies can use the disclosure framework set forth by

the United States Equal Employment Opportunity Commission’s EEO-1 Survey.

Non-US companies are encouraged to disclose this information in alignment

with SASB’s guidance and nationally appropriate frameworks.

- Board Level- Diversity characteristics, including racial and ethnic makeup, of the

board of directors.

4. Board: Articulate goals and strategy related to racial and ethnic representation at the

board level, including how the board reflects the diversity of the company’s workforce,

community, customers and other key stakeholders.

5. Board oversight: Describe how the board executes its oversight role in diversity and

inclusion.

Further, we ask companies to assess the barriers to entry and impediments to recruitment

and retention of diverse talent, especially at senior levels of the organization. We encourage

companies to take steps that ensure that diverse talent pools are sourced, supported and

developed. At the board level, the talent pipeline is often narrowed by focusing on job

experiences, such as being a former CEO, at the expense of the core competencies that

strong directors possess. Companies that intentionally expand their search criteria often cite

that there is already a broad pool of racial and ethnically diverse talent available.

These topics will be part of our engagement conversations. As always, our primary tool is

engagement with management and the board with the objective of understanding a

company’s plan and how the board is carrying out its oversight role. However, if required,

we are prepared to use our proxy voting authority to hold companies accountable for

meeting our expectations.

We recognize that change—particularly in today’s economy—can seem daunting. Our own

company, State Street Corporation, has taken many steps to address inequality and racism

in our organization, in our communities and through our asset stewardship program, which

are outlined in our past Corporate Responsibility Reports and Stakeholder Report. But we,

too, have much more work to do, particularly when it comes to our board and senior

leadership representation. Senior management has recently reviewed our company’s

practices and committed to taking 10 immediate actions to strengthen racial equality, which

can be viewed here. Our board will oversee our progress.

As our Chairman and CEO, Ron O’Hanley wrote in June, “Simply because most of us are

innocent bystanders does not mean that we can just stand by.” Indeed, as we have learned

over the past several years—from the launch of our Fearless Girl campaign to today—when

we work together on matters of value for investors and companies alike, we can improve

bottom lines, drive greater overall shared prosperity and also advance social progress, in

alignment with State Street’s mission.

We look forward to engaging on this important issue. For questions, please reach out to our

Asset Stewardship Team at Governanc[email protected]om.

Sincerely,

Rick Lacaille

Global Chief Investment Officer

State Street Global Advisors

Responsible-Factor (R Factor) scoring is designed by State Street to reflect certain ESG characteristics and does

not represent investment performance. Results generated out of the scoring model is based on sustainability and

corporate governance dimensions of a scored entity.

Janis, I. (1972). Groupthink: Psychological studies of Policy Decisions and Fiascoes. Boston: Houghton Mifflin

McKinsey, Delivering through Diversity

A. Garnero, S. Kampelmann, and F. Rycx, “The Heterogeneous Effects of Workforce Diversity on Productivity,

Wages, and Profits,” Centre Pour La Recherche Economique et Ses Applications Document de travail no 1304,

September 2013, pp. 4-5.

"Global Diversity and Inclusion: Fostering Innovation Through a Diverse Workforce,” Forbes Insights, last modified

July 2011

"Kelly Services: Diversity must help bottom line to be sustainable," Crain's Detroit Business, last modified

November 14, 2013

McKinsey, Delivering through Diversity

PWC, Magnet for talent: Managing diversity as a reputational risk and business opportunity

Big Companies Track Workforce Diversity But Won't Share the Results, Bloomberg, July 27, 2020

The information provided does not constitute investment advice and it should not be relied on as such. It should not

be considered a solicitation to buy or an offer to sell a security. Investing involves risk including the risk of loss of

principal. It does not take into account any investor’s particular investment objectives, strategies, tax status or

investment horizon. You should consult your tax and financial advisor.

All information is from SSGA unless otherwise noted and has been obtained from sources believed to be reliable,

but its accuracy is not guaranteed. There is no representation or warranty as to the current accuracy, reliability or

completeness of, nor liability for, decisions based on such information and it should not be relied on as such.

The whole or any part of this work may not be reproduced, copied or transmitted or any of its contents disclosed to

third parties without State Street Global Advisors’ express written consent.

State Street Global Advisors Global Entities

3208933.1.1.GBL.RTL

Exp. Date: 08/31/2021

Figure 1: Building on SASB Disclosure

The Sustainability Accounting Standards Board (SASB), a nonprofit standards-setting

organization focused on enhancing investor-relevant sustainability disclosure, articulates

detailed accounting metrics and disclosure standards related to employee diversity for

companies in nine industries: E-commerce, Multi-line and Specialty Retailers, Asset

Management & Custody, Investment Banking & Brokerage, Advertising & Marketing,

Professional & Commercial Services, Hardware, Internet Media & Services, Semiconductors,

and Software & IT Services. While we generally support SASB’s framework and industry-

specific approach to ESG disclosure, we have stressed that SASB represents a floor, not a

ceiling, for our expectations on ESG management and disclosure. We believe diversity to be a

systemically important issue across our portfolio, and therefore seek similar information from

portfolio companies beyond these nine industries. We encourage companies in other

industries to use the disclosure guidelines set forth in the SASB Standards for those nine

industries, which are themselves guided by the EEO-1 framework, to inform disclosure on this

topic.