THE CHARLES SCHWAB CORPORATION | Gender and Racial Pay Gap at THE CHARLES SCHWAB CORPORATION

Status
AGM passed
AGM date
Previous AGM date
Proposal number
5
Resolution details
Company ticker
SCHW
Lead filer
Resolution ask
Report on or disclose
ESG theme
  • Social
ESG sub-theme
  • Diversity, equity & inclusion (DEI)
  • Remuneration or pay
Type of vote
Shareholder proposal
Filer type
Shareholder
Company sector
Financials
Company HQ country
United States
Resolved clause
Resolved: James McRitchie, of CorpGov.net, requests the Charles Schwab Corp (“Company” or “Schwab”) report annually on unadjusted median and adjusted pay gaps across race and gender globally and/or by country, where appropriate, including associated policy, reputational, competitive, and operational risks, and risks related to recruiting and retaining diverse talent. The report should be prepared at reasonable cost, omitting proprietary information, litigation strategy, and legal compliance information. Racial/gender pay gaps are the difference between non-minority and minority/male and female median earnings expressed as a percentage of non-minority/male earnings.
Supporting statement
Supporting Statement: Pay inequities persist across race and gender. They pose substantial risks to companies and society. Black workers’ hourly median earnings represent 64% of white wages. Median income for women working full time is 83% of that of men.[1] Intersecting race, Black women earn 63%, Native women 60%, and Latina women 55%.[2]  At the current rate, women will not reach pay equity until 2059, Black women 2130, and Latina women 2224.[3]
Citigroup estimated closing minority and gender wage gaps 20 years ago could have generated 12 trillion dollars in additional national income.[4] PwC estimates closing the gender pay gap could boost OECD economies by $2 trillion annually.[5] Actively managing pay equity is linked to superior stock performance and return on equity.[6]
Best practice includes:
1. unadjusted median pay gaps, assessing equal opportunity to high-paying roles,2. statistically adjusted gaps, assessing whether minorities and non-minorities, men and women, are paid the same for similar roles.
Over 20 percent of the 100 largest U.S. employers currently report adjusted gaps, and an increasing number of companies disclose unadjusted gaps to address the structural bias women and minorities face regarding job opportunity and pay.[7] Schwab reports neither.
Racial and gender unadjusted median pay gaps are accepted as the valid way of measuring pay inequity by the United States Census Bureau, Department of Labor, OECD, and International Labor Organization.[8] The United Kingdom and Ireland mandate disclosure of median pay gaps, and the United Kingdom is considering racial pay reporting.
An annual report adequate for investors to assess performance could integrate base, bonus and equity compensation to calculate:• percentage median and adjusted gender pay gap, globally and/or by country• percentage median and adjusted racial/minority/ethnicity pay gap, U.S. and/or by country
[1] https://www.nationalpartnership.org/our-work/resources/economic-justice/fair-pay/americas-women-and-the-wage-gap.pdf
[2] https://www.aauw.org/app/uploads/2021/09/AAUW_SimpleTruth_2021_-fall_update.pdf
[3] https://iwpr.org/iwpr-publications/quick-figure/the-gender-pay-gap-1985-to-2020-with-forecast-for-achieving-pay-equity-by-race-and-ethnicity/
[4]  https://ir.citi.com/NvIUklHPilz14Hwd3oxqZBLMn1_XPqo5FrxsZD0x6hhil84ZxaxEuJUWmak51UHvYk75VKeHCMI%3D
[5] https://www.pwc.com/hu/en/kiadvanyok/assets/pdf/women-in-work-2021-executive-summary.pdf
[6] https://www.mckinsey.com/capabilities/people-and-organizational-performance/our-insights/promoting-gender-parity-in-the-global-workplace ; https://www.issgovernance.com/file/publications/ISS-ESG-Gender-Diversity-Linked-to-Success.pdf
[7] https://diversiq.com/which-sp-500-companies-disclose-gender-pay-equity-data/
[8]https://static1.squarespace.com/static/5bc65db67d0c9102cca54b74/t/622f4567fae4ea772ae60492/1647265128087/Racial+Gender+Pay+Scorecard+2022+-+Arjuna+Capital.pdf

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