Wells Fargo and Bank of America tried, unsuccessfully, to appeal to the U.S. Securities and Exchange Commission to exclude the “median pay gap” proxy resolution from going to a vote of shareholders. But the effort failed. Representatives of wealth-manager Arjuna Capital presented their resolution this morning at Bank of America’s annual meeting in Charlotte, and yesterday at Wells Fargo’s annual meeting in Dallas. The resolutions call on investors to vote in favor of the bank producing a detailed report disclosing the “median” or company-wide pay gap that exists between women and men across race and ethnicity. 26 percent of Bank of America and 23 percent of Wells Fargo shareholders agreed and voted “yes” on ballot items #5 and #6, respectively, up from 15% in 2017 when pay equity was first put on the ballot of the firms.
Natasha Lamb, managing partner, Arjuna Capital and filer of the median gender pay gap shareholder resolution said: “The Bank of America and Wells Fargo shareholder votes show more and more momentum from investors asking for pay equity at the big banks. Companies trying to evade this issue or influence stakeholders and lawmakers that median pay figures are misleading, are doing a disservice not only to women and people of color in the workplace, but to their company’s ability to retain top talent and the performance benefits diversity affords.”
On January 16, Arjuna Capital announced early success with its gender pay shareholder engagements on the “median pay gap” when Citigroup agreed to become the first US company to disclose the difference between what women and minorities make and what men and non-minorities make on a company-wide scale.
Lamb continued: “Citigroup made the right choice to disclose its median pay data, and announce steps to even the playing field for women and minorities at the top echelons of the company. Now, it’s time for Wells Fargo, Bank of America, and other leading US companies to meet that same standard. Investors want honest and transparent disclosures, not an attempt to obfuscate reality and claim that median gender and racial pay gap numbers don’t matter.”
On February 12, Arjuna Capital announced the full scope of its median gender and racial pay gap campaign, targeting 12 US banks, technology, and retail companies, including: Adobe, Amazon, Intel, Facebook, Google, Bank of New York Mellon, Bank of America, Wells Fargo, American Express, JPMorgan and Mastercard.
Wells Fargo and Bank of America tried unsuccessfully to argue that disclosing the median pay gap between men and women amounted to micromanagement by investors, and therefore could fall under the SEC’s guidelines for exclusion. The SEC denied the legal maneuver to block Arjuna’s proposal so shareholders at both companies voted this week on greater transparency on company-wide median pay. Mastercard also petitioned the SEC to attempt to exclude the proposal.
Proposals at Bank of New York Mellon and Adobe went to a vote on April 9th and 11th, garnering 25% and 33% of the vote, respectively. Additional proposals will go to a vote at American Express on May 7th; Intel on May 16th; JP Morgan on May 21st; Amazon on May 22nd; Facebook on May 31st; Alphabet/Google on June 6th; and Mastercard on June 26th.
Arjuna Capital has filed a total of 46 proposals at 23 companies in the tech, financial, and consumer sector. 22 of these companies have committed to disclose and close their pay gaps on an adjusted equal pay for equal work basis, an important first step. This year Arjuna is requesting more comprehensive reporting from the companies, and filed a new proposal with 12 companies requesting unadjusted global median gender and U.S. racial pay gap data. This evolution is important because while adjusted data shows if there is equal pay for equal work, unadjusted median pay data shows if there is equal opportunity to high paying jobs.