Files
Abstract
This research focuses on the tax, financial reporting, and sustainability consequences that companies face
as a part of settling agreement non-disclosure clauses for workplace sexual harassment claims and cases.
Given recent events such as the sexual harassment cases of former Governor Andrew Cuomo and those
in the entertainment industry like Harvey Weinstein, managers, and decision-makers must be able to
justify decisions to include such clauses in a settlement agreement, and then require an external review of
the facts, circumstances, practices, and institutional policies which helped lead to such claim(s). The recent
change in legislation and regulation has impacted how companies can work to eliminate and combat sexual
harassment cases in the workplace. Using contextual analysis, we first examine the tax considerations
of non-disclosure clauses, post-adoption of I.R.C. §162(q), and subsequently review emerging financial
reporting consequences of sexual harassment, and finally, we review sexual harassment in relation to the
growing SRI movement and its focus on the two specific ESG factors related to governance and social
issues. Our research proposes practical guidelines, considerations, and reforms for companies to manage
tax, financial, public relations, and environmental, social and governance (ESG) elements associated with
efforts to “weed out” sexual harassment behaviors within organizations.