FOR IMMEDIATE RELEASE

NorthStar Completes Successful Shareholder Engagement to Develop Fair Chance Employment Program

Boston, MA (April 27, 2023) – In honor of Second Chance Month, NorthStar Asset Management, Inc. (“NorthStar”)^[1] of Boston as shareholders of  Xylem Inc. (“Xylem”) common stock announces a successful engagement with Xylem company management codifying a new commitment to establish a fair chance employment program in 2023. In furtherance of its long-standing commitment to diversity, equity and inclusion and its prior work to support fair chance employment, Xylem is launching this groundbreaking employment program at two U.S. locations this year, with a goal to scale to other manufacturing locations in 2024. The program aims to recruit formerly incarcerated individuals into the Xylem talent pool.

Fair chance employment practices, also referred to as “second chance hiring,” allow applicants with prior arrest or incarceration records to be fairly considered for employment without a criminal history biases. Xylem’s new program will lower the barriers, but not the bar for qualified individuals to obtain employment. Mari Schwartzer, Director of Shareholder Activism and Engagement at NorthStar led the engagement, “We approached Xylem for two reasons. Xylem is a leader in a manufacturing sector that is growing quickly and in need of talent, and second, entry level jobs in this sector are more likely to pay a living wage. Xylem’s willingness to take direct action to create opportunities through this robust hiring program demonstrates that they understand both the obstacles that this community faces and the potential talent of these individuals.”

In the U.S. one in three adults have a criminal record, with communities of color disproportionately impacted. Black Americans are five times more likely to be incarcerated than White Americans, while Latinx Americans are 1.3 times more likely to be incarcerated than White Americans.^[2] People who have been convicted of a felony face 45,000 collateral consequences after release, with 62% of those consequences working against them in attempting to secure employment or earn occupational and professional licenses.^[3] Due to the stigma of a criminal records, these individuals are often overlooked for employment opportunities, preventing economic mobility and successful re-entry into society. Fair chance employment is a direct opportunity for corporations to recognize this racial disparity and play an important role in lowering these hurdles and widening their recruitment to this eager, capable talent pool. During our engagement with Xylem, NorthStar’s Schwartzer pointed to evidence that demonstrates that formerly incarcerated employees can have lower turnover and better attendance and disciplinary records compared to their peers without criminal records.

Xylem plans to pilot the fair chance employment program this summer at two of its locations; one of these sites was selected, in part, due to large population of black and brown communities within the surrounding areas. Xylem hopes to scale the program to other locations in 2024. “We are proud to see companies recognizing the importance of incorporating racial equity within their fair chance employment initiatives. This goes to show the alignment of fair chance employment to DEI company goals,” said Schwartzer. Fair chance employment not only makes a positive difference in the livelihoods of these individuals and their families, but it also has the potential to benefit companies, communities, and the economy.

NorthStar originally filed a shareholder resolution at Xylem November 2022. The resolution, “Eliminating Discrimination through Inclusive Hiring,” asked the Xylem board of directors to prepare a report analyzing “how the company’s hiring practices related to people with arrest or incarceration records are aligned with publicly stated DEI (diversity, equity, and inclusion) statements and goals, and whether those practices may pose reputational or legal risk due to potential discrimination (including racial discrimination) claims.” Xylem then developed its program as an extension of its DE&I strategy. NorthStar has filed similar fair chance employment proposals this proxy season at Adobe Inc., Badger Meter Inc., IDEX Corporation.

NorthStar Asset Management, Inc. is a wealth management company based in Boston with a focus on socially responsible investing.  At NorthStar, creative shareholder engagement is a positive force for change.

Contact: Julie Goodridge

NorthStar Asset Management, Inc.

Boston, Massachusetts

617-522-2635

Press[at]northstarasset.com

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[1] NorthStar Asset Management is a socially responsible asset management firm based in Boston, Massachusetts.

[2] https://www.sentencingproject.org/reports/the-color-of-justice-racial-and-ethnic-disparity-in-state-prisons-the-sentencing-project/

[3] https://www.americanbar.org/content/dam/aba/publications/criminaljustice/cc_national_summit_report.pdf