Procter & Gamble shareholders seek pay disclosures by gender and race

A Massachusetts investment firm behind a successful shareholder proposal urging Kroger to disclose pay gaps for women and minorities is pushing for a similar measure at Procter & Gamble 's annual shareholder meeting on Tuesday .

In a non-binding measure during the consumer product giant's online-only annual meeting, Arjuna Capital wants the maker of Tide laundry detergent to begin reporting the median differences in pay between non-minority males and females.

'Enlightened' firm says pay gaps pose 'substantial risks'

It also wants Cincinnati-based P&G to report the pay gap between white men and minority male and female workers. Touting an "enlightened" approach to investing, the Manchester-by-the-Sea-based firm describes its philosophy as seeking "financial returns while promoting a more vibrant economy, a healthier environment, and a more just society."

"Pay inequities persist across race and gender and pose substantial risks to companies and society at large," the investment firm said in support of the measure in P&G's proxy statement . "Actively managing pay equity is... linked to superior stock performance and return on equity."

P&G is 'happy' to disclose some pay gaps

In its proxy, P&G pledged it would be "happy" to disclose gender and race pay gaps – on an adjusted basis only (Arjuna wants the company to report both adjusted and unadjusted). Unadjusted pay gaps would simply calculate a median of white male pay to women or minorities. Adjusted pay gaps remove factors such as "job level, performance, job-related skills and experience," to more "accurately reflect whether employees are being equitably paid."

On an adjusted basis, P&G admitted to the slightest of pay gaps:

Given the disclosure, P&G said Arjuna's measure was "unnecessary," and added reporting more data could "distract from our long-term efforts, unhelpfully narrow internal and external focus on discrete metrics, and misalign our reporting and strategy."

Environmentalists protested outside P&G CEO's house last year

The pay equity measure is the only shareholder proposal listed on this year's proxy besides routine votes on board members, appointing its audit firm and an advisory measure on executive compensation. Last year, the company voted on several shareholder proposals and CEO Jon Moeller faced an environmental protest near his suburban Cincinnati home in Covington, Kentucky.

Last year, Kroger shareholders approved the non-binding pay gap measure and the grocery giant has since pledged to begin disclosing both adjusted and unadjusted figures in its annual ESG (environmental, social and governing) report , starting in 2025.

Three top P&G execs are women and or minorites

Earlier this year, P&G disclosed Moeller was the highest-paid local Fortune 500 head, making $23 million in its latest fiscal year ended June 30. Moeller's pay ratio to P&G's median worker (who earns almost $70,000 a year) is 329 to 1 , the second-highest among the local major public companies behind Kroger. The proxy also lists pay figures for its top five executives, three of whom are not white males:

· Shailesh Jejurikar , the company's chief operating officer (and a top future CEO candidate), made $9.7 million

· Alexandra Keith , the CEO of the company's beauty business, made $6.8 million

· Fatima Francisco , the company's CEO of baby, feminine and family care businesses, made $6.6 million

A big employer and major manufacturer

With annual sales of $84 billion, P&G is one of the largest consumer products companies in the world and employs 108,000 workers, including 30,000 in the U.S. (with 10,000 in Greater Cincinnati). In the U.S., the company owns and operates 24 factories in 18 states. Overseas, it also owns and operates 78 plants in 33 countries.

Besides Tide, P&G also manufactures such medicine cabinet staples as Pampers diapers, Gillette razors, Crest toothpaste, Pantene shampoo, Vicks cough drops and many others .

How to watch

P&G will webcast its shareholder meeting virtually via a live audio webcast on Tuesday at 12:00 p.m. Eastern Time.LINK: www.virtualshareholdermeeting.com/PG2024

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