Edit

Booker Presses Kroger and Albertsons on Diversity and Inclusion as Companies Seek Merger

Government and Politics

December 7, 2022


WASHINGTON, D.C. – U.S. Senator Cory Booker (D-N.J.) pressed The Kroger Company and Albertsons Companies, Inc. on diversity and inclusion and urged them to take steps to increase their commitments to address racial and economic disparities as the companies seek to merge.

In October, Booker, a member of the Senate Judiciary Committee, joined Senators Amy Klobuchar (D-MN) and Richard Blumenthal (D-CT) to express “serious concern” about the companies proposed merger.

“While I remain deeply concerned about the proposed Kroger-Albertsons merger and its impact on food security, grocery worker jobs, food prices, and market competition, I also understand this moment serves as a critical inflection point for racial justice for your companies, the communities you serve, and for our country,” wrote Senator Booker in a letter to the Kroger Company CEO Rodney McMullen and Albertsons Companies, Inc. CEO Vivek Sankaran. “As you continue to work towards this proposed merger, I write to request information about how your companies are prioritizing diversity and inclusion throughout this process and to urge you to take steps to strengthen these commitments.

“The racial wealth gap remains one of the most pernicious vestiges of slavery and Jim Crow laws, and is emblematic of the need to attack these problems in a multi-dimensional way. The lack of economic opportunity for Black and Brown businesses, alongside intentional, government- sponsored efforts such as red-lining, have thwarted wealth creation among communities of color…Large public and private enterprises have a crucial role to play in fostering opportunities for a diverse workforce, executive leadership, and for diverse-owned businesses, both large and small, through utilizing their services as part of spending on vendors…While legislation and federal, state, and local policies are important elements, the private sector can and should take steps to accelerate this change. As you look to the future, I urge you to remain national leaders by setting new standards for diversity and inclusion in the professional services industry during a merger and acquisition. This is an opportunity to bring together diverse and excellent talent, in line with your companies’ commitments and help set standards for not only your industry, but for industries across the country.”

Senator Booker requested that Kroger and Albertsons respond to a series of questions on steps that are being taken to increase the utilization of diverse owned professional services businesses and whether the two companies are tracking what they spend with these types of businesses:

    What is the status of the preexisting commitments to diversity and inclusion by Kroger and Albertsons, and how would those commitments be impacted by the proposed merger?
        Do you collect data on workforce diversity? If so, please provide that information.
        Do you collect data on board and management diversity? If so, please provide that information.
    Do you currently track the amount your respective company spends with diverse-owned vendors? If so, please provide that information.

        Do you currently disaggregate this information by industry (e.g., legal, communications, marketing/media services, financial services, human resources, technology, engineering, auditing/accounting, consulting)? If so, please provide that information.
        Do you currently disaggregate this information by racial and ethnic categories, beyond simply the term “minority”? If so, please provide that information.

    Do you have board-level discussions about developing strategies to increase your company’s utilization of diverse-owned professional services companies? If so, please provide summaries of those plans.

    I understand that Goldman Sachs & Co. LLC and Credit Suisse Group AG, and Citigroup Inc. and Wells Fargo Securities LLC, advised Albertsons and Kroger, respectively. Of the investment teams considered to facilitate this process–

        How many were minority- or women-led or owned?
        Of the investment banks considered, were any minority- or women-led or owned teams hired?

    I understand that six firms are providing legal counsel: Weil, Gotshal & Manges LLP and Arnold & Porter Kaye Scholer, and Jenner & Block LLP, White & Case LLP, and Debevoise & Plimpton LLP, to Kroger and Albertsons respectively. Of the legal teams considered –

        How many were minority- or women-led or owned?
        Of those considered, were any minority- or women-led or owned firms hired?  

The full text of the letter can be found here.