Gender and Racial Pay Gap

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RESOLVED: James McRitchie of CorpGov.net and other shareholders request The Boeing Company (Boeing) report annually on unadjusted median and adjusted pay gaps across race and gender globally and/or by country, where appropriate, including associated policy, reputational, competitive, operational risks, and risks related to recruiting and retaining diverse talent. The report should be prepared at reasonable cost, omitting proprietary information, litigation strategy, and legal compliance information.

Racial/gender pay gaps are defined as the difference between non-minority and minority/male and female median earnings expressed as a percentage of non-minority/male earnings.

SUPPORTING STATEMENT: Pay inequities persist across race and gender. They pose substantial societal and company risks. Black workers’ median annual earnings represent 77 percent of white wages. The median income for women working full time is 84 percent that of men. Intersecting race, Black women earn 76 percent and Latina women 63 percent.[1]  At the current rate, women will not reach pay equity until 2059, Black women in 2130, and Latina women in 2224.[2]

Citigroup estimated closing minority and gender wage gaps 20 years ago could have generated $12 trillion in additional national income. PwC estimates the gender pay gap costs OECD economies $2 trillion annually.

Minorities represent 35.8% of Boeing’s United States workforce and 21.8% of Executives. Women represent 24.1% of the workforce and 33.2% of executive leadership.[3] Actively managing pay equity is associated with improved representation. Diversity is linked to superior stock performance and return on equity.  

Best practice includes:

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

Boeing does not report quantitative unadjusted or adjusted pay gaps. 50 percent of the 100 largest U.S. companies by market capitalization report adjusted gaps. An increasing number of companies disclose unadjusted gaps to address the structural bias women and minorities face regarding job opportunity and pay. 

Racial and gender unadjusted median pay gaps are accepted as the valid way of measuring pay inequity by the United States Census Bureau, Department of Labor, OECD, and International Labor Organization. The United Kingdom and Ireland mandate disclosure of median pay gaps, and the United Kingdom is considering racial pay reporting.

While Boeing reports diversity data, unadjusted median and adjusted pay gaps would show how Boeing assigns value to its employees. Pay gap reporting provides digestible, comparable data to determine progress over time.

An annual report adequate for investors to assess performance could integrate base, bonus, and equity compensation to calculate:

percentage median and adjusted gender pay gap, globally and/or by country
percentage median and adjusted racial/minority/ethnicity pay gap, U.S. and/or by country

SUPPORTING DATA:

https://static1.squarespace.com/static/5bc65db67d0c9102cca54b74/t/622f4567fae4ea772ae60492/164726 5128087/Racial+Gender+Pay+Scorecard+2022+-+Arjuna+Capital.pdf

Diversity Improves Stock Performance. 

[1] https://www.census.gov/data/tables/time-series/demo/income-poverty/cps-pinc/pinc-05.html – par_textimage_24

[2]https://static1.squarespace.com/static/5bc65db67d0c9102cca54b74/t/622f4567fae4ea772ae60492/1647265128087/Racial+Gender+Pay+Scorecard+2022+-+Arjuna+Capital.pdf

[3] https://www.boeing.com/resources/boeingdotcom/principles/diversity-and-inclusion/assets/pdf/Boeing_GEDI_Report_FINAL.pdf