At Wednesday's annual meeting at eBay, nearly 45 percent of the votes cast by shareholders were in favor of the gender pay gap measure, which was co-filed with Pax World Investments. In a statement, eBay CEO Devin Wenig said that before receiving the proposal, eBay had begun conducting an analysis of pay equity that's still underway, and expects to complete the review by October, promising to share it publicly. "Importantly, if we find that we have an issue, we will fix it," he said. "I believe companies and their leadership must address gender pay equity issues intentionally and proactively."
Since that tally includes abstention votes, it's not quite a majority. But the figure is still unpredictably high for a social issue on a company proxy, which typically don't see big votes in their favor.
"That it received that level of support is extraordinary," said Charles Elson, director of the Weinberg Center for Corporate Governance at the University of Delaware. Historically, he said, proposals on issues of a social or environmental nature get votes "in the single digits," as eBay did last year when just eight percent of investors voted in favor of a similar proposal from Arjuna. "[Investors] who've proposed these things have now argued that they're economic in nature -- that they have serious economic impact on the company's profitability."
While that might help explain the high vote, a recommendation from proxy adviser Institutional Shareholder Services, which advise investors on how to vote, was also likely a big factor, Elson said. ISS suggested investors vote in favor of the gender proposal at eBay, saying the resolution "is warranted, as eBay lags its peers in addressing gender pay disparity at its company."
Meanwhile, Citigroup received a similar proposal from another investor, Trillium Asset Management, though there was a notable difference. While the Arjuna measure asked companies to report on policies and goals toward closing the wage gap, Trillium asked the company to prepare a report actually "demonstrating the company does not have a gender pay gap." Citing the "prescriptive and potentially burdensome nature of the request," ISS advised investors to vote against it. And earlier this week, they largely did just that, with not even 5 percent of votes cast in favor of the measure at the bank's annual meeting on Tuesday, according to Trillium.
Still, there could be two more opportunities for investors to weigh in on the issue. Currently, Arjuna's pay gap proposals are on preliminary ballots at both Facebook and Alphabet, the parent company of Google, which hold their annual meetings in June. Both companies oppose the resolution.
A Google spokesperson said in an email earlier this month that an internal team "constantly analyzes performance, compensation and promotion to ensure that there is no gender pay gap at Google;" in the company's filing, it said it didn't think the proposal "would enhance Alphabet’s existing commitment to fostering a fair and inclusive culture." Facebook, meanwhile, shared a statement from its head of human resources saying "men and women earn the same" at the company and called the report "unnecessary and not beneficial to our stockholders" in a filing.