Big U.S. Banks Resist Pressure for More Gender Pay Gap Disclosure
(Bloomberg) -- Last year, Citigroup announced that men and women in its workforce were paid equally for equal work -- its adjusted gender pay gap, the bank said, was essentially non-existent. The other big U.S. banks also made similar disclosures, and the takeaway—there’s no gender pay gap!—was deceptively rosy.
But earlier this year, Citigroup offered a new analysis. On average, the company’s female employees earn 29 percent less than the men there, a reflection of how few women occupy the most lucrative jobs.
This time, none of its peers have followed, leaving Citigroup alone among the biggest U.S. banks to disclose a full picture of compensation, by gender, at the company.
Arjuna Capital, which successfully pressured banks to publish their adjusted pay gaps last year, wants other banks and tech companies to follow Citigroup’s lead. The shareholder announced Wednesday that it has filed shareholder proposals with Adobe, Amazon, American Express, Bank of America, Bank of New York Mellon, Facebook, Google, Intel, JPMorgan, Mastercard and Wells Fargo asking these companies to report their median gender pay gaps. Three of these companies have already filed petitions to the U.S. Securities and Exchange Commission, trying to block the proposal.
“There are gender pay gaps and there are median gender pay gaps and understanding between the two will help determine how much progress women make in terms of fair compensation in the next decade,” said Arjuna co-founder Natasha Lamb. “The two numbers tell a more complete story.”
Since 2016, Arjuna has pressured 22 large, public U.S. companies to share their adjusted pay gaps, a figure that measures whether women and men are paid equally, after adjusting for job title, responsibilities, tenure, geography and other factors that affect compensation.
“If you look at ‘equal pay for equal work,’ you think everything is great,” Lamb said. “Well, is it really?” What that figure doesn’t show is representation. A raw figure, like what Citigroup reported last month, shows who holds the highest paying jobs. (At Citigroup and in most companies: Men do.)
Intel, which posted its 2019 gender pay data a week after Citigroup, reported only an adjusted pay gap figure, not a raw figure that compares total median compensation, like Citigroup did. The tech company said that, when comparing men and women in similar jobs, there was no pay gap in its global workforce.
“The issue that I find with the pay gap analysis Citi did is it just takes an average of all men and women’s pay,” said Julie Ann Overcash, Intel’s director of compensation and benefits. “That is valuable because it ensures you have representation, but it doesn’t ensure you have equitable pay for equal work.” Citigroup released both figures.
Lamb said companies are resistant to her proposals because they’re reluctant to reveal big gaps. In the U.K., where companies with more than 250 employees are required to report their median pay gaps, some banks reported gaps of more than 50 percent. Intel reported that women make 32.5 percent less than men and their median bonus pay is 45.2 percent lower than men at the company.
These gaps are also harder to close, because they reflect how few women occupy the highest paying roles but cluster in low and mid-level jobs. Lamb hopes that pushing companies to report will push them to work harder to get more women in higher paying roles.
“We believe it’s time to tell the whole story,” said Lamb. “Equal pay was an incredibly important first step. It’s time to be honest about median pay and tell the whole story.”
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