“Human capital” disclosure: analysis of the latest 10-Ks

HCM Disclosure 21 YouTube Thumbnail

– More than half of recent 10-Ks touched upon these topics: COVID-19 health measures, DE&I, compensation & benefits, talent development, collective bargaining, health & safety and geography.
– Quantitative disclosures were most commonly found with geography and turnover (84% and 66%, respectively). Less than half of the 10-Ks had numbers for DEI, collective bargaining, engagement, health & safety and pay equity.

Hat tip to Aon for putting in the work to slug through 725 Form 10-Ks filed this proxy season and push out this memo. The memo has great bar graphs that make the findings easy to digest – and key findings include:

– Overall, there was an increased robustness in both the number of items discussed and the prevalence of categories disclosed from our original article in January 2021 until now. The most prevalent categories are COVID-19 safety measures; diversity, equity and inclusion; compensation and benefits; and talent development. There is a big drop off in the prevalence of the other categories after those four.

– Topics such as geography; turnover; and diversity, equity and inclusion have high instances of quantitative disclosures.

– The average number of categories discussed was consistent across industries, with each industry discussing roughly eight topics. This includes information on number of employees and geography.

– Certain HCM topics will impact industries differently, which is reflected in the types of disclosure. For example, manufacturing firms were most likely to include disclosure around collective bargaining agreements while technology companies were more likely to disclose information around geography given a more dispersed and now remote workforce.