Two Companies, One Day, Two Very Different Results
Merck published its annual sustainability report this week. The company’s website still states that Merck was among the first U.S. companies to disclose Equal Employment Opportunity data and that it will “continue to do so annually.” The EEO-1 report that claim points to contains 2023 data and has not been updated.
Two years ago, Merck disclosed its workforce by gender and by race and ethnicity at every level of the organization, along with new hires and promotions broken out by both. This year, most of that is gone, and its PeopleReturn Transparency Score fell from 71.3 to 4.6.
AMD published its annual sustainability report the same day. For the ninth straight year, it published data tables covering five years of workforce data — and each year the reporting has grown more granular. Beyond demographics, this year’s report includes parental leave taken and returned from by gender, entry-level wages, training hours per employee, engagement survey results, and workplace safety down to contractor lost-time severity and days lost.
AMD does not top our rankings. It discloses little on board composition or pay equity, two of the four categories the Transparency Score measures, and lands mid-pack as a result. But on the substance of what a workforce report contains, we track no company that discloses more.
Two of America’s largest companies reported on the same day and made very different decisions about how much to tell investors about their workforces.
That’s a good illustration of what we found while analyzing five years of public-company reporting for our forthcoming 2026 Human Capital Reporting Trends Report + Data Pack: the retreat hasn’t been indiscriminate. Companies have been selective about what they stopped reporting.
A few of the numbers:
- Overall turnover disclosure is down only 4% from its peak prevalence and new-hire disclosure is down just 7%.
- Workforce gender disclosure is down 22%% and race and ethnicity 28%. New hires by race has declined 52% from its peak.
- 78.4% of the S&P 500 still reports workforce gender representation, but only 19.6% reports it for executives.
- The S&P 1500’s average Transparency Score peaked at 32.9 in 2024. It now stands at 21.4, below where it started in 2022.
The full report also looks at what happened after the Nasdaq board diversity rule disappeared, the unraveling of EEO-1 publication, the movement of workforce data out of SEC filings, and which companies have retreated the furthest. The accompanying data pack includes the underlying benchmarks.
We’ll publish both next week.
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The Hardest-Working Stock Photo in Corporate America
Sustainability reports are ultimately an exercise in storytelling. Companies spend months deciding how to present their business to investors, employees and prospective hires, from which metrics to disclose down to the words, colors and images they use.
The stock photography apparently gets less attention.
This week, while going through company reports, careers pages and sustainability sites, we kept running into the same father and son. They are building a sustainable future at Danaher, building connected communities at Crown Castle, delivering long-term value at TD, financing affordable housing at Capital One, recruiting employees at CSL Plasma, and illustrating “Happiness for All” at Toyota Europe.
It’s Getty Images 1325876463, “Young Boy Leaping Into Father Arms In Playground.” Toyota didn’t rename the file. Danaher pasted the stock caption straight into its alt text: “a young boy leaping into his fathers arms from a log while messing around in a playground at the park together.”
At least somebody in sustainability is still getting steady work.
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You Only Get One Chance to Make a First Impression. Unless You’re a CEO.
L3Harris CEO Christopher Kubasik stepped down Monday after a board investigation found conduct inconsistent with the company’s code of conduct. The company has not said what he did. Semafor, citing two people briefed on the investigation, reported that an independent probe found he had an inappropriate relationship with an employee.
It wasn’t his first such exit. In 2012, Kubasik resigned from Lockheed Martin, weeks from becoming CEO, after the board asked for his resignation over a close personal relationship with a subordinate that violated the company’s code of ethics. This time, he forfeits roughly $45 million on the way out and keeps roughly $80 million in stock and options.
The pattern is well documented. Mark Hurd resigned from HP in 2010 over expense reports tied to a contractor and was president of Oracle a month later. Brian Krzanich left Intel in 2018 over a past relationship with an employee and has run two companies since. Outside the misconduct-and-relationships category, Parker Conrad was pushed out of Zenefits in 2016 over a licensing scandal and personally paid a half-million-dollar SEC settlement; he founded Rippling the following year.
Why it keeps happening isn’t complicated:
- The pool is small. Recruiters told the Journal that scarcity alone makes boards more willing to look past misconduct. Proven operating performance clears a lot.
- Boards separate personal conduct from business conduct, and companies say so in writing. L3Harris’s announcement specified that the conduct was unrelated to financial reporting, controls, customer relationships or operational performance. That sentence is written for investors. It reads to the next board like a reference.
- The record is thin by design. Item 5.02 of Form 8-K standardizes the disclosure of an executive departure without generally requiring the reason. Firms typically disclose the fact and the date and either omit the reason or describe it vaguely.
- Silence has measurable value. Research on undisclosed SEC investigations finds no difference in rehire rates for CEOs who exited before an investigation became public, while those whose investigations were disclosed faced lower rehire odds and worse subsequent jobs. Different category of misconduct, same mechanism: what isn’t disclosed doesn’t price in.
- Time launders. Kubasik joined L3 three years after Lockheed, was its CEO by 2018, and ran the merged company from 2021.
Which is the point of the Journal’s companion piece. A board that says nothing at the exit isn’t just failing its own employees, it’s helping supply the clean record the next board will hire on.
And the diligence cost isn’t hypothetical: firms that hired a quietly investigated CEO saw their own odds of an SEC investigation rise by roughly 15.9%.
What we’re reading:
- US firms that kept DEI policies despite ‘go woke, go broke’ threats thrived Conservative backlash was supposed to put an end to the diversity, inclusion and equity (DEI) movement as companies were warned “go woke, go broke”. But new research published on Friday and shared exclusively with the Guardian found that companies that resisted the pressure and kept their DEI practices, including Costco, Apple and Delta Air Lines, performed just as well as their competitors who pulled back. (The Guardian)
- What Companies Reward: The Changing Mix of Metrics in Executive Incentive Pay Nonfinancial metrics in executive pay are often viewed through the narrower lens of whether companies are adopting or retreating from ESG-linked pay. The data suggest a more nuanced shift: boards are not abandoning nonfinancial measures but becoming more selective about which measures belong in pay plans and how they connect to business performance. (The Conference Board)
- Job Security Statistics: 54% Would Accept a Pay Cut for Greater Job Security According to Monster’s 2026 Job Security Report, more than half of U.S. workers (54%) say they’d accept a pay cut in exchange for greater job security. Even more notably, 61% say they’d be willing to give up at least one aspect of their compensation or workplace experience if it meant feeling more secure in their role. (Monster)
- Walmart store workers have a new responsibility: correcting AI errors Retail jobs often involve a lot of cleaning up after other people. Dusty shelves, spilled liquids, smudged display cases, and, more recently, AI agent errors. In Walmart’s bid to fuel its growth ambitions, the retailer is betting big on AI and arming thousands of frontline employees with new tools and training. (Business Insider)
- CEO of $49 billion AI company says it’s ‘mind-boggling’ people think you can work 38 hours a week, have work-life balance, and be successful “This notion that somehow you can achieve greatness, you can build something extraordinary by working 38 hours a week and having work-life balance, that is mind-boggling to me,” Andrew Feldman, cofounder and CEO of $49.5 billion AI chip company Cerebras, stressed on the 20VC podcast last year. “It’s not true in any part of life.” (Fortune)
- Is Your Organizational Culture Too Nice? Organizations with a culture of niceness run the risk of compromising performance, while those with a more rigorous culture are more likely to achieve their financial goals and fulfill their organizational purpose. (Harvard Business Review)