Citibank is one of six financial firms that a shareholder is targeting for more information about its gender pay gap. (Mark Lennihan/AP Photo)

Last year, the investor Arjuna Capital helped urge seven tech companies to doing something unexpected: Publish the percentage pay gap that exists between their male and female employees and commit to closing it.

Now, the woman behind that push is taking aim at another industry known for its male-dominated workplace: The financial sector.
Natasha Lamb, managing director of Arjuna Capital, which focuses on sustainable and social impact investing, said Thursday she had filed proposals at six financial companies urging them to prepare a report addressing their goals at reducing the gender pay gap and including the percentage gap between the pay of men and women. The banks and credit card firms targeted are Citigroup, Wells Fargo, American Express, MasterCard, Bank of America and JPMorgan Chase.

"It makes no sense to hold America's top tech companies to a high standard on gender pay equity and then pretend that banks should be allowed to discount the issue and operate with no transparency," Lamb said in a conference call with reporters.

Lamb said she was going after the major banks in part because financial services is such a male-dominated industry. In the proposal, she cited data from the Bureau of Labor Statistics, which shows female financial advisers faced a 61.3 percent pay gap in 2014, the widest of occupations reviewed, as well as a 2016 study from the management consultancy Oliver Wyman showing it will take three decades before women reach 30 percent of the industry's executive committees. Other research cited showed links between risks and rewards for investors in companies that have diverse executive teams.

Lamb said she has been in dialogue with all the companies in question, but most of the financial firms have been more opposed to her proposal. "We've seen a night and day difference in the tech and financial worlds," Lamb said.

All but one of the six companies have come out against the proposal, Lamb said; she has not gotten an answer from MasterCard. Among the nine tech companies she worked with last year, only three formally opposed the resolutions in their proxies, one of which was eBay, where an unusually high number of shareholders voted in favor of the proposal and the company said it would share its analysis publicly.

Of course, the tech companies revealed nearly nonexistent percentage gaps when analyzing people working in similar jobs, which may have made them more willing to share the information. Those numbers also overlook the industry's position gap: Men and women may earn roughly the same in the same jobs, but men are more frequently in higher-paying roles in both of these industries.

Meanwhile, four of the banks -- Wells Fargo, Bank of America, American Express and Citigroup -- defended their numbers of female leaders and their pay practices in lengthy sections of their proxy statements. In them, the companies highlighted a range of internal efforts to prevent bias, improve numbers of women and minorities, use third party consultants to check for pay equity, as well as note recognition they've received for diversity and leadership involvement in diversity programs. As a result, Lamb's proposal was described by the companies as unnecessary.

In an emailed statement, Citigroup spokesman Mark Costiglio added that "we have had productive discussions with Arjuna Capital on their proposal and look forward to continued engagement on this issue." JPMorgan has not yet released its proxy, and a spokesman declined to comment, though Lamb said she expects the company to oppose the proposal, pending further dialogue.

A spokesman from MasterCard, which also hasn't released its proxy, said in an emailed statement that it would be premature to comment on the resolution but that the company "strive[s] to ensure gender pay parity. We regularly examine pay practices and, at our company, both in the U.S. and globally, men and women in the same level earn equal pay for equal performance."

Arjuna is not the only investor to propose votes about the gender pay gap this year; investors Pax World and Zevin Asset Management have also filed proposals, though some have been withdrawn after dialogue with companies.

How bank investors will vote on the measure won't be clear until companies hold their annual meetings in the coming weeks. Votes for "social" resolutions like these are typically low -- last year, just 5 percent of investors voted in favor of a gender pay gap proposal from Trillium Asset Management. But Lamb says her proposal is not as "prescriptive" as the one at Citigroup last year, and believes her success at eBay shows there may be more interest in the topic.
Being transparent, Lamb believes, "is in the enlightened best interest of these companies." As investors become more and more attuned to the data linking diversity and financial returns, it's become clearer "this is not a niche issue. It's a mainstream investor issue, and that's because there's a business case to support it."

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