NIKE, INC. | Report on Median Gender/Racial Pay Gap

AGM date
Proposal number
6
Resolution details
Company ticker
NKE
Lead filer
Resolution ask
Report on or disclose
ESG theme
  • Social
ESG sub-theme
  • Diversity & human capital management
Company sector
Consumer Discretionary
Company HQ country
United States
Resolved clause
Resolved: Shareholders request Nike report on median pay gaps across race and gender, 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 defined as the difference between minority and non-minority/female and male median earnings expressed as a percentage of non-minority/male earnings (Wikipedia/OECD, respectively).
Whereas clause
Whereas: Pay inequity persists across race and gender. Black workers' hourly median earnings have fallen 3.6 percent since 2000, representing 75.6 percent of white wages. The median income for women working full time in the United States is 82 percent that of men. Intersecting race, African American women make 62 cents on the dollar, Native women 60 cents, and Latina women 54 cents. At the current rate, women will not reach pay equity until 2059, African American women until 2130, and Latina women until 2224.

Citigroup estimates closing minority and gender wage gaps 20 years ago could have generated 12 trillion dollars in additional national income. McKinsey projects closing the racial wealth gap could net the United States economy 1.1 to 1.5 trillion by 2028. PwC estimates closing the gender pay gap could boost Organization for Economic Cooperation and Development (OECD) countries' economies by 2 trillion dollars annually.

Diversity is linked to superior stock performance and return on equity. Actively managing pay equity is associated with improved representation. Of note, 23.9 percent of Nike employees are black, but black employees represent only 5.3 percent of employees above director level. Women account for 49.5 percent of Nike' s workforce and 42.5 percent of employees above director level.

Pay gaps are literally defined as the median pay of minorities and women compared to the median pay of non-minorities and men, considered the valid way of measuring gender pay inequity by the United States Census Bureau, Department of Labor, OECD, and International Labor Organization.

Best practice pay equity reporting consists of two parts:

1.unadjusted median pay gaps, assessing "equal opportunity" to high paying roles
2.statistically adjusted gaps, assessing pay for workers performing similar roles

Nike reports parity for statistically adjusted gaps but ignores unadjusted median gaps.

The Equal Employment and Opportunity Commission now mandates pay data reporting, across race and gender, as workforce diversity data alone is insufficient to assess pay inequity. The United Kingdom mandates disclosure of median gender pay gaps and is considering race and ethnicity reporting. Nike reported a four percent median gender base pay gap and a 25 percent bonus gap for United Kingdom employees.
Supporting statement
Supporting Statement: An annual report adequate for investors to assess performance could, with board discretion, integrate base, bonus and equity compensation to calculate:

•percentage median gender pay gap, globally and/or by country, where appropriate
•percentage median racial/minority/ethnicity pay gap, US and/or by country, where appropriate