7 of 9 Targeted Financial Institutions Agree to Share Information and Adjust Salaries; Will Insurance Companies Reinsurance Group and Progressive Take Action?
Natasha Lamb, Arjuna Capital: “The American Express agreement on gender pay equity completes the group of seven leading banks and credit card companies that we engaged on behalf of shareholders this year. Two insurance companies remain, but we’ve accomplished more than we hoped.”
BOSTON AND NEW YORK CITY (March 7, 2018) – Seven of the biggest financial companies in the world have announced proactive steps to wipe out gender pay inequity in response to shareholder proposals from Arjuna Capital for detailed wage data reports. American Express (AMEX) today became the 7th company since January 15th to agree to the terms of the proposal and commit to disclose and close any gender pay gap, pledging to report its data to shareholders by the end of 2018. Peer company Mastercard made its announcement on February 12, following negotiations with Arjuna. In response to the Amex announcement, Arjuna withdrew its shareholder proposal this morning on behalf of its clients and the co-filer, Walden Asset Management.
The majority of financial companies targeted by Arjuna Capital on gender pay equity (seven of nine in 2018) have now responded proactively to shareholder engagements, measuring and ameliorating pay practices on key measures to the vicinity of 99 percent.
On January 15th, Citigroup was the first US bank to disclose its gender and racial pay gap through an internal announcement and salary adjustments. Bank of America joined Citi on January 25th, becoming the second big bank to address shareholder concerns on gender and racial pay equity. Wells Fargo made a similar announcement on Thursday, February 1st, trailed by Bank of New York Mellon on February 6th. Mastercard published an announcement online on February 12th, and the last of the big banks engaged by shareholders, JPMorgan, agreed to terms on Feb. 23rd.
In 2016, six of the originally targeted institutions (Bank of America, Mastercard, American Express, JP Morgan, Wells Fargo and Citi) rejected shareholder proposals asking for detailed reports on the percentage pay gap between male and female employees across race and ethnicity, including base, bonus and equity compensation, policies to address that gap, the methodology used, and quantitative reduction targets. This year, Arjuna Capital filed gender pay equity shareholder proposals at nine leading financial institutions, also asking Bank of New York Mellon, Reinsurance Group, and Progressive Insurance to publish their gender pay gaps.
Natasha Lamb, managing partner, Arjuna Capital said: “American Express has reaffirmed its commitment to diversity and status as one of the best places to work in America. Our engagement with AMEX has paid off, not only for investors, but for women working at one of the most vaunted credit issuers in the world, who will now rest assured that they are paid equitably. AMEX and Mastercard are setting the bar on gender pay equity in the credit card industry. Change is happening, and fast. Since Citigroup first broke the silence on gender pay on January 15th, seven of the biggest financial companies in the world have ushered in a new era for women on Wall Street. All seven banks and credit card companies we’ve engaged have now committed to a transparent accounting of gender pay. Only two insurance companies remain as holdouts from our 2018 finance industry campaign.”
American Express has pledged to disclose its gender pay data by the end of 2018. Today, American Express stated: “We are committed to ensuring that our pay and reward structure is equitable and free of any bias. This is a key component of our overall commitment to creating a diverse and an inclusive workplace, which has been a consistent and critical focus for us for nearly three decades. To help meet these commitments, we regularly review our compensation practices to ensure they support pay equality and transparency, and we are proud of our record.
Based on the most recent comprehensive pay analysis we conducted with a third-party consulting firm, we are confident that our colleagues are compensated equitably, regardless of gender. The review found no evidence of bias in our compensation processes and indicated we were effectively at parity. Going forward, we will continue our reviews in partnership with an independent external consultant. If and when we discover gaps, we will take appropriate actions to correct them, and we will continue to disclose our overall results.”
More information on the March 7, 2018 gender pay equity disclosure from American Express is available here: (http://about.americanexpress.com/news/gender-equity.aspx)
Lamb continued: “Despite positive developments for gender pay on Wall Street, women are still 20 percent more likely to leave a career in finance than any other industry—that’s bad for business and it’s bad for investors. Equal pay is therefore a critical first step to retain and attract top talent. And despite recent attention to equal pay in the finance world, we know other problems remain entrenched, such as few women on boards and sexual harassment in the workplace.”
The AMEX gender pay resolution is available online at: http://arjuna-capital.com/wp-content/uploads/2018/02/AXP-Shareholder-Proposal_Gender-Pay-Equity-2018.pdf
Arjuna Capital’s letter withdrawing the AMEX proposal is available at: (http://arjuna-capital.com/wp-content/uploads/2018/03/Arjuna-Capital-American-Express-Withdrawal-Letter_03.07.18.pdf).
The financial services sector has been under scrutiny for a lack of female representation in senior roles despite the fact women comprise a majority of its employees. In the UK, where employers are required to publish their gender pay gaps by April, banks have reported median pay gaps averaging approximately 32 percent.
ABOUT ARJUNA CAPITAL
Arjuna Capital is an investment firm focused on sustainable and impact investing. Lamb and Arjuna Capital have been recognized for using shareholder resolutions to promote gender pay equity in the tech, banking, and retail sectors. Natasha Lamb was named to the “Bloomberg 50” list of influencers who defined global business in 2017. For more information, visit www.Arjuna-Capital.com.
CONTACT: Patrick Mitchell, (202) 441-7647 or [email protected].