Citigroup Inc. offered an uncharacteristically blunt assessment of the pay gap between men and women in its global workforce Wednesday, revealing that female employees earn 29 percent less than men do.
The disclosure — a comparison of median total compensation — offers a more complete picture of pay, compared with the figures Citigroup and other big banks released last year under pressure from shareholders in the U.S. and regulators in the U.K.
The bank also reported that, among its U.S. employees, people of color earn 7 percent less than their white colleagues.
“The numbers are difficult,” said Sara Wechter, Citigroup’s global head of human resources. “We should obviously be at 100 percent parity, and that’s what we’re striving for.”
The gap reflects a company that’s mostly male at the highest levels. Women make up more than half of Citigroup’s workforce, but only 37 percent of employees at the assistant VP level through the managing director level. Over the years, banks have lost black executives. In 2017, Citigroup saw a drop in black bankers for the eighth consecutive year. Black workers only make up 1.8 percent of executive and senior manager positions, according to data compiled by Bloomberg.
In an attempt to close the gaps, Citigroup has committed to increasing representation at the assistant VP to managing director levels to at least 40 percent for women and 8 percent for black employees in the U.S. by 2021.
The new disclosure stands in contrast to numbers Citigroup released last year. In accordance with a new U.K. law, the bank reported that among its U.K. employees, women earned 44 percent less than men, a gap that widened to 67 percent when bonuses were included.
Around the same time, and under pressure from Arjuna Capital, Citigroup and several other big U.S. banks reported a different measure for U.S. employees. Instead of comparing the median pay for men and women, the banks “adjusted’’ the pay gap to account for job title, seniority, education and other factors that affect compensation. All the banks, including Citigroup, reported that after adjustments, there was almost no pay gap between men and women.
“As companies put out these ‘equal pay for equal work’ numbers, there’s been a lot of skepticism,” says Natasha Lamb, a managing partner at Arjuna Capital. In November, Arjuna filed a shareholder proposal asking Citigroup to report the more straightforward comparison of men’s and women’s median earnings for its entire 200,000-person workforce — not just for U.K. employees.
“If we’re only dealing with statistically adjusted numbers, then we’re only dealing with half the problem,” Lamb said. “We need more women in higher-paid positions and leadership.”
Wechter said the new disclosure is part of the company’s commitment to transparency and to improving diversity. Last summer, Citigroup published a plan to improve gender balance and racial representation in the next three years.
Arjuna is withdrawing its resolution. “This sets the stage for others to step up,” Lamb said. “It’s a badge of honor to be disclosing at this level, rather than a point of criticism. We all know the gaps are there.”
— Check out Corporate Boards Making Little Progress in Adding Women: MSCI on ThinkAdvisor.