For nearly five years, major U.S. corporations have been subject
to intense scrutiny over their decisions on whether to release
internal pay gap percentages in response to shareholder proposals
by Arjuna Capital, LLC and other activist shareholder groups. As
these activist groups maintain a keen interest in seeking
compensation-related disclosures from industry giants, employers
should be mindful of certain issues in considering their
response.
Initial Activist Demands and Employer
Responses
Companies have responded to these shareholder proposals in
several different ways. While some companies quickly disclosed pay
gap information, other large technology, retail, and banking
outfits were reluctant to disclose the requested information, and
some sought to exclude the wage gap shareholder proposals from
their annual shareholder proxy statements by requesting "no
action" letters from the SEC. These efforts were
unsuccessful.
