Korn Ferry Survey: Retailers Have Concerns Over Upcoming Rule Requiring Their Companies to Disclose Ratio of CEO Pay to Median Employee Salary
-- Nearly Two-Thirds Are Worried about Explaining Pay Ratio to Employees --
-- Comparison of their Companies’ Pay Ratio to Other Retailers Top Concern --
Key Survey Findings
- Fifty-six percent are concerned with the comparison of their ratio to that disclosed by other retail companies.
- Sixty-four percent of retailers are concerned about explaining the meaning of the CEO pay ratio to employees.
- Nearly half (48 percent) are not going to address the pay ratio disclosure ruling with their employees. Only 20 percent said they would address the issue with employees, and 32 percent are undecided.
- Three-quarters (76 percent) responded that their median employee will be part-time for the purposes of the ratio calculation.
The median income reported by the retailers for part-time employees
$12,000 to $14,000.
- Retailers reported anticipated pay ratios from 100 to more than 2000. The majority of respondents reported their CEO ratio is likely to between 200 and 1100 of the median employee total compensation.
- Seventy percent will use W-2 earnings as the “consistently applied compensation measure” to determine the median employee.
“Retailers are concerned that their pay ratio is likely to be higher
than other industries because of the significant use of entry-level,
part-time employees,” said
“It’s not surprising that retail organizations are worried about the
internal and external optics of their CEO pay ratio,” said
About the Study
Leaders from 50 retailers with a median revenue of