We wanted to share a quick update Pax World’s frontline work with gender equality and corporate behavior. Select Pax World funds are utilized by Blue Summit in our SRI portfolios. The below article was written by Pax and details their committed facilitation of Ebay’s shift from gender laggard to gender leader.
Quick fact: In 2014, Ebay had 9% women on its board and 11% in executive leadership. This was far below the PAX target of 31% percent females in board seats. In 4 years, the PAX team found that the representation of women on the board and in management at eBay had surpassed 30 percent, placing it among the highest-rated companies globally for advancing women into senior leadership positions and meeting our standard. How did eBay get from gender laggard, with only token representation of women in decision-making roles, to gender leader?
A Gender Journey
We know that greater diversity on corporate boards leads to better decision-making, oversight and improved company performance. Pax World Funds has long used shareholder engagement as a way to better understand a company’s approach to gender diversity and encourage change.
Impax had identified board diversity as an area for improvement at eBay in 2013 - there was just one woman among the company’s 11-member board of directors. We signaled our concern by voting our proxy against the three male nominees standing for election at eBay’s April 2013 annual meeting. The company did not respond, and the same scenario played out the following year.
Based on the company’s unresponsiveness to our outreach, we filed a board diversity shareholder proposal at eBay in late 2014. The proposal requested the company produce a report to outline its plans to increase gender and racial diversity on the board.
Talk Turns Into Action
Our goal was to have a productive dialogue with eBay, and the proposal opened the door to just that. During our conversations, the company recognized that it could set new principles for gender inclusion, and commit to achieving them.
During the course of our engagement, eBay announced the appointment of Bonnie Hammer to its board. Because of these actions, we withdrew our proposal. Shortly thereafter, eBay nominated another woman — Gail McGovern — to its board. EBay’s pledge to seek diverse candidates remains active; while its board composition has undergone changes, primarily in connection with the company’s spin-off of PayPal, since 2015, three of the seven independent directors appointed to the Board have been women, bringing the total number of diverse directors to four.
EBay’s executive leadership team has undergone a similar transformation since 2013 through a series of internal promotions and new hires. Today, there are five women on that team.
eBay continues to be transparent about its successes as well as challenges along its journey to greater diversity and inclusion: The company hired a chief diversity officer in 2017 and published its second Global Diversity & Inclusion Report, including the results of its second global study of gender pay equity, in April 2018. Needless to say, we were not surprised to see the company emerge from our analysis as a gender leader in late 2018. Over the last four years, eBay has positioned itself among the roughly 400 companies in the world that are doing the most to advance women.