This story appeared in Bank Digest.
Although the banking industry has made modest changes to close the CEO-to-worker pay gap, which was a subject of Financial Services Committee hearings in March and April, "it has a long way to go," according to a press release issued by Committee Chair Maxine Waters (D-Calif). The release stated that, under the Dodd-Frank Act, publicly traded companies, including megabanks, are required to disclose the ratio of what they pay their CEO to the median annual compensation of their workers.
Following the hearings, Waters asked megabanks for more information on their CEO compensation packages, worker pay, and the CEO-to-worker pay gap. Having considered that information, she said Committee Democrats will continue to push prudential regulators and megabank CEOs to ensure just compensation for workers.
Waters made the following recommendations: all megabanks should increase their minimum wage to at least $20 per hour by the end of the year, and to at least a "living wage" in the next two years, so that all workers have enough to meet their basic needs, including food, housing, and clothing; all boards for megabanks should consider ways to narrow excessive CEO-to-median worker pay ratios; and financial regulators should finalize meaningful executive compensation rules that curb inappropriate compensation practices.