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Mar 16, 2022

Disney shareholders back pay equity report proposal

Board had objected to the measure

Shareholders in The Walt Disney Company voted at its AGM last week to approve a proposal seeking disclosure around pay equity.

Almost 60 percent of votes cast supported a proposal brought by Arjuna Capital requesting that ‘Disney report on both median and adjusted pay gaps across race and gender, including associated policy, reputational, competitive and operational risks, and risks related to recruiting and retaining diverse talent.’

Arjuna Capital, which has sponsored proposals at companies on gender and racial pay gap disclosure in previous years, writes in its supporting statement that best practice pay equity reporting consists of two elements:

  • Unadjusted median pay gaps, assessing equal opportunity to high-paying roles
  • Statistically adjusted gaps, assessing whether minorities, non-minorities, men and women are paid the same for similar roles.

‘Disney does not report its unadjusted or adjusted pay gaps,’ the proponent writes. ‘[More than] 20 percent of the 100 largest employers currently report statistically adjusted gaps. An increasing number of companies also disclose unadjusted median pay gaps, as they more fully address the structural bias women and minorities face regarding job opportunity and pay.’

Disney had unsuccessfully sought SEC no-action relief for excluding the proposal. The board writes in the company’s proxy statement that its ‘quarrel with the proposal is not its focus – as the company is fully committed to achieving pay equity – but whether it is a necessary and effective use of company resources given the policies, practices and reporting that the company already has in place to achieve that end. Given the many ongoing initiatives that the company is already pursuing to promote opportunity and equity, the board believes it is not.'

For example, it says, the company strives to pay all employees equitably by taking into account factors such as role, function, market data, internal equity, job location, relevant experience and individual, business unit and company performance. Among other things, it states that Disney reports on its workforce representation diversity and has published its US Equal Employment Opportunity data for 2019 and 2020.

It adds that the company has established strong board oversight and governance of compensation practices in support of the aim of ensuring fair and equitable pay.

A spokesperson for Disney says in a statement: ‘We appreciate our shareholders’ view on this important issue, and the board accepts the results of today’s vote. The company is committed to pay equity, and we will continue our ongoing work on this front, including addressing interest in greater transparency around our efforts.’

Ben Maiden

Ben Maiden is the editor-at-large of Governance Intelligence, an IR Media publication, having joined the company in December 2016. He is based in New York. Ben was previously managing editor of Compliance Reporter, covering regulatory and compliance...