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3 Stocks That Stress Equal Pay As We Observe International Women’s Day

American Express, Citigroup, and Adobe are leading the charge in pay equity.

Securities In This Article
Adobe Inc
Citigroup Inc
American Express Co

Which companies are committed to equal pay in their workforces? You might want to look at American Express AXP, Citigroup C, and Adobe ADBE.

Equal Pay Day hypothetically illustrates how far into the new year a woman must work in order to earn the same amount earned by a man the previous year, using average income. Because women earn less, they need to work longer for the same pay.

In the United States, women earn on average $0.82 for every dollar men make. In 2023, we mark Equal Pay Day on March 14, the week after International Women’s Day.

Strong Pay Equity Means Lower Turnover, Higher Productivity

Equal pay has implications for investors. Last year at this time, the Gender Pay Gap Bot on Twitter named and shamed U.K.-based firms that promoted International Women’s Day on social media yet reported significant gender pay gaps. Although many companies promote inclusivity and equity in the workplace, they do not always practice what they preach. Studies have found that firms with strong pay-equity programs experience reduced turnover, increased productivity, and even an increase in revenue.

3 Companies With Strong Pay-Equity Practices

Our team examined the state of pay equity and disclosure practices at large companies traded in the U.S. To do this, we used Morningstar Sustainalytics data to identify U.S. firms with strong strategic programs and transparent disclosure on the gender pay gap. We combed high-performing companies’ sustainability reports to better understand their pay-equity practices. We also looked at the firms’ Sustainalytics ESG Risk Ratings and aspects of their financial performance, such as their Morningstar Economic Moat Ratings and price/fair value ratios.

Here are our top stock picks leading the charge in pay equity this year. All data is from March 1, 2023.

American Express

Morningstar Rating: 3 stars

Sustainalytics ESG Risk Rating: 18.7, Low

Price/Fair Value: 1.09

Morningstar Economic Moat Rating: Wide

American Express scores highest on our list for a strong pay-equity program. The company maintains a public goal of 100% pay equity across genders globally, and across races and ethnicities in the U.S. American Express began annual pay-equity reviews in 2017, and its annual ESG Report discloses that for the second year in a row, it closed the gender pay gap, ensuring that 100% of women were paid equally for equal work compared with male counterparts. American Express examines its pay practices and then adjusts the pay of those deemed to be underpaid. Most notably in 2021, the median pay for the company’s female employees globally was 106.7% of the median pay for male employees, with 55% of its workforce identifying as female. This is a signal that women make up higher-paying roles, on average, than their male counterparts by a slight margin. With a Low ESG Risk Rating and wide economic moat rating, this stock pick topped our list.


Morningstar Rating: 5 stars

Sustainalytics ESG Risk Rating: 27.8, Medium

Price/Fair Value: 0.69

Morningstar Economic Moat Rating: None

Citigroup was the first U.S.-based company to disclose its adjusted pay-gap results, and in 2019, it became one of the first U.S. companies to disclose its unadjusted pay gap for women and U.S. minorities. The adjusted pay gap measures equal pay for equal work (two individuals in the same job with the same levels of performance and experience), while the unadjusted pay gap examines the average pay of women compared with men throughout the organization, regardless of role. Citigroup also partners with The Female Quotient, a women-owned business dedicated to advancing equality in the workplace through a free digital pay-gap tool for companies. Citigroup fares exceedingly well on key Morningstar metrics, earning a 5-star rating, and it is the most undervalued U.S. bank stock that Morningstar covers.


Morningstar Rating: 4 stars

Sustainalytics ESG Risk Rating: 12.9, Low

Price/Fair Value: 0.76

Morningstar Economic Moat Rating: Wide

Adobe is another leader in pay-equity reporting. There is plenty to admire about the company, including its creative business strategy and wide moat rating. In addition, the stock trades at a discount to fair value. Adobe reported achieving global gender pay parity (equal pay for equal work) and equal pay for under-represented minority groups compared with non-under-represented minority groups in the U.S. market as of 2021. It also set an ambitious goal to achieve a 30% increase of women in leadership positions by 2025. Adobe has a dedicated webpage to highlight its pay-equity program, detailing the steps to examining its gender and racial pay gap while educating others to learn from its leadership. Its strong environmental, social, and governance management is also shown through its ESG Risk Rating, which is Low at 12.9.

Although not the only indicator of business success, strong pay-equality programs can signal positive management styles, providing insight into companies that are equipped for the long term.

Morningstar will publish its 2022 corporate sustainability report on March 31, 2023, disclosing pay-equity program successes from last year.

The author or authors do not own shares in any securities mentioned in this article. Find out about Morningstar’s editorial policies.

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