Arjuna Capital and Proxy Impact released their annual “Racial and Gender Pay Scorecard” to mark Equal Pay Day on March 14th. According to the report, Target is the 1st company in the history of the Scorecard to earn a perfect score—A+.
Of 68 companies examined, Starbucks, Mastercard, Microsoft, Pfizer, Bank of New York Mellon, Citigroup, Adobe, American Express, Visa, Lowe’s, Best Buy, and Home Depot receive an A, while twenty-five companies receive an F.
“Equal Pay Day – the day of the year when women working in the U.S. finally earn the same amount as men did in the year before – is an unfortunate reminder that historic wage inequity continues,” said the Acting Secretary of Labor Julie Su in a statement.
“To build an inclusive economy, we need to enable workers to obtain jobs based on their interests, skills, and aptitude rather than gender, race or ethnicity, and promote good-paying jobs that follow fair wage setting practices, like those found in union employment, to help to eliminate the wage gap,” Acting Secretary Su added.
Key findings of the report include:
Target receives the 1st perfect score of A+ on the Racial and Gender Pay Scorecard, with Starbucks close behind. Both companies report 100% racial and gender pay equity on both an adjusted and unadjusted median basis for 100% of their employee population, assessed on all components of compensation—base, bonus, and equity.
50% more companies earn a grade of “A” this year, with 13 companies receiving this score due to comprehensive racial and gender pay gap disclosures.
15 companies improve their scores year-over-year. Lowe’s and Best Buy saw the largest score increase from an F to a B, as they began disclosing comprehensive adjusted and unadjusted median racial and gender pay gaps.
Intel’s (D) and Google’s (F) scores fall for failing to disclose quantitative pay gaps or methodology within the last two years, despite commitments to investors. Four companies—Cigna, eBay, Intel, and Google—lost ground from last year.
25 companies earn a failing grade of “F” due to their lack of transparency, including Google, Goldman Sachs, Marriott, Charles Schwab, and Walmart. Eighteen of these companies—remain on the failing list from last year.
Consumer companies lead the way on pay gap disclosures, with the sector comprising 38% of companies awarded an “A” score. Five consumer companies—Target, Starbucks, Lowe’s, Best Buy, and Home Depot—report median pay gaps. According to PayScale, 58% of retail and customer service companies plan to conduct a race or gender pay equity analysis in 2023.
The healthcare sector lags behind, with only Pfizer disclosing median pay gaps and Thermo Fisher committing to disclose median gaps this year. The healthcare industry is reported to have the third widest pay gap across 15 industries.
Of the 68 companies covered by the Scorecard, 18 companies currently disclose or have committed to disclose in the next year. This includes Target, Starbucks, Lowe’s, Best Buy, Home Depot, Chipotle, Mastercard, Bank of New York Mellon, Citigroup, American Express, Pfizer, Microsoft, Adobe, Visa, Disney, Amalgamated, BlackRock, and Thermo Fisher.
Over the last nine years, 158 shareholder proposals requesting pay gap disclosures have been filed at more than 90 companies (including the 68 in the Scorecard).
The Scorecard highlights an increasing number of companies that are setting a new standard for the accountability and transparency needed to close persistent racial and gender pay gaps. Last year, U.S. Black workers’ median earnings represented 81 percent of white workers’ earnings and women’s earnings represented 83 percent of men’s earnings.
