Walgreens Boots Alliance | Set Compensation Policy that Optimizes Portfolio Value for Company Shareholders at Walgreens Boots Alliance

Status
AGM passed
AGM date
Previous AGM date
Resolution details
Company ticker
WBA
Resolution ask
Report on or disclose
ESG theme
  • Social
ESG sub-theme
  • Decent work
Type of vote
Shareholder proposal
Filer type
Shareholder
Company sector
Consumer Staples
Company HQ country
United States
Resolved clause
BE IT RESOLVED, shareholders ask that the board and management exercise their discretion to establish Company wage policies that are reasonably designed to provide workers with the minimum earnings necessary to meet a family’s basic needs, such policies to include reference to established living wage frameworks and timeframes for adoption and to comply with relevant legal obligations.
Whereas clause
WHEREAS: Company compensation practices that fail to provide a living wage are harmful to the economy and therefore to the returns of diversified shareholders;
Supporting statement
SUPPORTING STATEMENT:
The Company recently raised its starting wage to $15 per hour and its median employee was paid $24,530 in 2022, or 0.14% of the CEO’s compensation. By comparison, the living wage in 2022 was $25.02 per hour ($52,038.85 per worker annually, for a family of four (two working adults).1 While the Company’s workforce is 71 percent female and 51 percent people of color, those groups make up only 43 percent and 25 percent of senior management, and thus make up a disproportionate number of Company employees not earning a living wage.]
Such inequality and disparity harm the entire economy. For example, closing the living wage gap worldwide could generate an additional $4.56 trillion every year through increased productivity and spending,2 translating to a more than 4 percent increase in annual GDP. A 2020 report found that had four key racial gaps for Black Americans—wages, education, housing, and investment—been closed in 2000, $16 trillion could have been added to the U.S. economy. Closing those gaps in 2020 could have added $5 trillion to the U.S. economy over the ensuing five years.3
By paying so many of its employees below a living wage, the Company may believe it will increase margins and thus financial performance. But gain in Company profit that comes at the expense of society and the economy is a bad trade for Company shareholders who are diversified and rely on broad economic growth to achieve their financial objectives. The costs and risks created by low wages and inequality will directly reduce long-term diversified portfolio returns because a drag on GDP directly reduces returns on diversified portfolios.4
This proposal asks the Board to set a Company compensation policy of paying a living wage to prevent contributing to inequality and racial/gender disparity. The Company could achieve this Proposal’s objective by securing Living Wage for US Employer certification.5 Additionally, MIT has an online living wage calculator, or the Company can work within frameworks promulgated by organizations such as IDH Sustainable Trade Initiative or The Living Wage Network. The Company should utilize such frameworks in a manner that allows shareholders to gauge compliance and progress, while providing the Company with discretion as to how to achieve the living-wage goal.
1 https://livingwage.mit.edu/articles/103-new-data-posted-2023-living-wage-calculator 2 https://tacklinginequality.org/files/introduction.pdf3 https://ir.citi.com/%2FPRxPvgNWu319AU1ajGf%2BsKbjJjBJSaTOSdw2DF4xynPwFB8a2jV1FaA3Idy7vY59bOtN2lxVQ M=4 https://www.epi.org/publication/secular-stagnation/5 https://livingwageforus.org/becoming-certified/

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