In Parity Effort, Salesforce Adjusts Employees’ Pay By $3 Million

By Wendy Lee
San Francisco Chronicle. said Tuesday that it made $3 million in adjustments to employee salaries this year to make sure women and men are paid equally.

“We looked at every single one of our female employees’ salaries, and we adjusted it against all of our male employees’ salaries,” said CEO Marc Benioff at the Fortune Global Forum on Tuesday. “We can say we pay women the same as we pay men.”

The Salesforce process, which started in April, is fairly innovative in Silicon Valley, where male employees by far outnumber females in technical positions at the largest tech firms. At Salesforce, 77 percent of the company’s tech workers worldwide are male. Salesforce has more than 17,000 employees.

Some analysts said it’s the first time they’ve heard of a large company adjusting salaries and being so transparent about it.
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“It’s a way to walk the talk. There is a lot of emphasis and concern about disparity in salaries between men and women, and not a lot of progress in correcting the problem,” said Rob Enderle with advisory services firm Enderle Group. “For a company like Salesforce to step up and put their money where their mouth is, it’s very important because it sets a precedent.”

The move was part of Benioff’s belief that more CEOs should shift their focus from short-term shareholder desires toward making long-term differences in communities. At the Fortune Global Forum Tuesday, he said he supports World Economic Forum chairman Klaus Schwab’s stakeholder theory.

“Your customers, your employees, your partners, your community — all of these are critical stakeholders,” Benioff said. “And if you can manage that stakeholder value, that is going to give you the highest shareholder return.”

Salesforce said it adjusted both men’s and women’s salaries as part of an effort to make sure its employees have equal pay.

The company also pushed forward initiatives to have females make up at least one-third of its executive management meetings and customer events. Women’s promotions have also increased at the company, with 32 percent of female employees promoted in the 12-month period through the end of July, compared with 24 percent in the previous 12 months, according to a blog post by Cindy Robbins, an executive vice president, in September.

“I’m proud to say that these efforts to create more development opportunities for our female employees are working,” Robbins wrote.

Kellie McElhaney, an adjunct professor at UC Berkeley’s Haas School of Business, said Benioff is brave to take on equal pay.

She believes that other tech companies will follow suit, similar to the cascade of firms that now post diversity data.
“In a way, he’s saying we have a problem, and we’re going to solve it,” McElhaney said.

More companies may also be forced to deal with the issue. Last month, Gov. Jerry Brown signed the Fair Pay Act , which goes further than federal law, requiring employers to pay women equally for “substantially similar work,” even if their titles are different or they work at different sites.

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