Press Release: "Shameful" big bank rejection of gender pay equity expected to continue Tuesday at MasterCard annual meeting
Arjuna Capital to See Sixth Vote on Gender Pay Equity Resolution in “1950s Style” Circling of Wagons by Out-of-Touch Industry; After Forcing Tech Leaders to Come Around on Gender Pay Equity, Shareholder Activist Persists to Turn Around Banks, Too.
PURCHASE, NEW YORK (June 26, 2017) – The sixth leading US bank or credit card company to face investor pressure to address its gender pay gap will advise to vote down the resolution Tuesday (June 27th) when MasterCard shareholders gather in Purchase, New York. For Arjuna Capital, the sponsor of the six resolutions, the expected Tuesday outcome is another sign of the antiquated refusal of US financial institutions to come clean and put an end to the gender pay gap.
Featured in the cover story of the current issue of Bloomberg BusinessWeek, Natasha Lamb, Managing Partner at Arjuna Capital, saw the same kind of “1950s style” corporate denial when she first took on America’s leading tech companies and pressed them to address gender inequity.
Lamb said: “Mastercard and America’s other leading banks and credit card companies need to face the inevitable. When companies ignore underlying structural problems, they only incite Wells Fargo-level damage to their reputations and brands. Ignoring gender inequities is bad for the companies, their employees, and their shareholders. Not only are companies passing up the financial benefits greater diversity affords, Investors stand to take the hit from a damaged brand, civil litigation, or governmental fines tied to gender inequity.”
The full text of the MasterCard resolution sponsored by Arjuna Capital is available at: https://arjuna-capital.com/wp-content/uploads/2017/06/MA-Shareholder-Proposal_Gender-Pay-Equity.pdf - along with a supporting memo at: https://arjuna-capital.com/wp-content/uploads/2017/06/MA-Gender-Pay-Gap-Shareholder-Letter-5_2017.pdf. Mastercard faces a 15% average pay gap, and a 20% top-earner pay gap according to Payscale.
In 2017, Arjuna Capital has sponsored six resolutions asking top banks and credit card companies about their policies and goals to reduce their gender pay gaps. The reports are intended to be sufficient for investors to assess the companies’ strategy and performance, and request the percentage pay gap between male and female employees across race and ethnicity, including base, bonus and equity compensation, policies to address that gap, methodology used, and quantitative reduction targets.
The five votes leading up to Tuesday are as follows:
- At Wells Fargo, 15.04 percent of shareholders voted in favor of gender pay equity;
- At Bank of America, 14.79 percent of shareholders voted in favor of gender pay equity;
- At JPMorgan, 14.87 percent of shareholders voted in favor of gender pay equity;
- At Citigroup, 14.32 percent of shareholders voted in favor of gender pay equity; and
- At American Express, just 11.66 percent of shareholders voted in favor of gender pay equity.
Is Lamb discouraged? Not at all. She knows that history is on her side. In 2015 and 2016, Arjuna Capital spearheaded a campaign that led seven of nine targeted tech companies to address gender pay inequity. Those that did are: Ebay, Adobe, Intel, Apple, Amazon, Expedia, and Microsoft. Efforts continue to press the two holdouts – Facebook and Alphabet (the parent of Google) – to disclose their gender pay gaps. Alphabet is now being investigated by the Department of Labor for “extreme” gender pay disparity.
Lamb added: “Unfortunately, we are engaged in a war of attrition on gender pay in the banking space. It is shameful behavior for the biggest financial companies in the world to ignore the problem and expect that everyone will give them a pass on it. Real change – a complete U-turn in how the biggest banks in our nation approach gender pay equity -- must overcome a business culture entrenched in an antiquated value system. A system that rewards men handsomely continues to foster an unequal playing field for women. The shareholder activism undergirding this effort will require additional time, multiple engagements, and tougher public pressure to expose the inequity in the current landscape.”
A 2016 Glassdoor study finds an unexplained 6.4 percent gender pay gap in the financial services industry after statistical controls for factors such as position and experience, among the highest of industries examined. Mercer finds female executives are 20 to 30 percent more likely to leave financial services careers than other careers. Women make up over half of entry-level positions in finance, yet a 2016 Oliver Wyman study finds it will take until 2048 to reach 30 percent female executive committee representation.
The median income for women working full time in the United States is reported to be 79 percent of that of their male counterparts. This $10,800 disparity can add up to nearly half a million dollars over a career. The gap for African American and Latina women is 60 percent and 55 percent respectively. At the current rate, women will not reach pay parity until 2059.
Arjuna Capital is an investment firm focused on sustainable and impact investing. For more information, visit www.Arjuna-Capital.com.
CONTACT: Patrick Mitchell, (703) 276-3266 or pmitchell@hastingsgroup.com.
Image provided courtesy of The Hastings Group.