19th February 2019

US banks targeted with “median gender pay gap” shareholder proposal

During an international news event with the Equal Rights Advocates and Closing the Women’s Wealth Gap Initiative, shareholder advocate Arjuna Capital named the 12 top banks and tech giants it is engaging in 2019, with median gender pay equity resolutions. Arjuna Capital’s median gender pay gap proposal has been filed with American Express, Bank of America, Bank of New York Mellon, JPMorgan, Mastercard and Wells Fargo.

In January, Citigroup surprised investors when it revealed that its “median” or companywide gender pay gap is 29 per cent. In doing so, Citi became the first US company to respond favourably to a new gender pay shareholder proposal from Arjuna Capital asking for a report to investors on the percentage global median pay gap between male and female employees across race and ethnicity, including base, bonus and equity compensation.

The unadjusted 29 per cent ‘median pay’ gap stands alongside and in contrast to an earlier disclosure Arjuna requested from Citi that women are paid 99 per cent that of their direct male peers on an adjusted ‘equal pay for equal work’ basis – that is men and women holding the same jobs, at the same level and geography.

Leading gender pay, shareholder advocates and women’s rights experts are cautiously optimistic that the other US companies engaged by Arjuna on median pay will follow in Citi’s footsteps and disclose their median wage data, alongside their equal pay data.

Arjuna Capital Managing Partner Natasha Lamb said: “There are gender pay gaps … and then there are median gender pay gaps. For three years, Arjuna Capital has led the charge on ‘equal pay for equal work’ shareholder activism. But ‘equal pay’ is only half the story. We are announcing the names of 11 leading banks, technology and retail companies that will be the focus of the next phase of the gender pay equity fight – 'median pay’ gaps.

"We hope to work with these companies in the same collaborative, productive way we did with Citi to publish authentic disclosures that address the full scope of the gender pay gap issue. Women are dramatically underrepresented in high-paying positions at nearly all major corporations. So, when more US companies begin disclosing their ‘median pay’ gaps, the numbers are going to be shocking. But that’s what we are dealing with. It’s the whole story.”

Companies, including Citi, which operate in the UK, are now under mandate to disclose median gender pay gaps. In 2018, Bank of America revealed a 31 per cent hourly pay gap for its UK operations. Citigroup reported a 36 per cent median pay gap in the UK, but prior to January’s announcement had not agreed to publish median information for its global operations. Median pay disclosures, as opposed to “equal pay” data reflect a lack of female representation in higher paying jobs, and fewer women in leadership.