Largest US public companies fuel increasing inequality crisis, finds Oxfam

Today, Oxfam, the global organization fighting inequality to end poverty and injustice, launched the Corporate Inequality Framework (CIF), one of the only holistic, data-driven assessments of the largest 200 public companies’ contributions to inequality in the United States. The analysis found that 90% – or more than $1.1 trillion – of the combined $1.25 trillion in net profits for those companies are paid out to wealthy shareholders. Simultaneously, only 5% – or 10 of the 200 companies – publicly support a living wage, while four of the 200 have CEO-worker pay ratios over 1500:1.

The first-of-its-kind analysis, which looks at publicly disclosed data from the largest US public companies, aims to shine a brighter light on corporations’ inequality footprints and empower investors to engage them on the policies and behaviors that fuel our inequality crisis.

The research found that inequality is part of the fabric of big business. Power and money remain concentrated with those already benefiting from the inequality machine in the US, driven by a combination of low worker wages, high CEO pay, record profits, and expensive share buybacks, among other factors.

Of the largest US companies, those with low median employee salaries tend to have high CEO-worker pay ratios, with four companies trending above a 1,500:1 ratio—Jabil (1,864:1), McDonalds (1,745:1), TJX Corporations (1,604:1), and The Coca-Cola Company (1,594:1).

“The corporate culture of maximizing profits at all costs is clearly driving the inequality crisis by lining the pockets of the already wealthy at the expense of our people and planet,” said Irit Tamir, Senior Director of Oxfam America's Private Sector Department. “Big business’ priority to make the rich richer fails to recognize the financial materiality and long-term economic risks of inequality. Publicly disclosed data shows that the concentration of corporate wealth and power stifles both economic participation and the wellbeing of the people who make such extraordinary corporate profits possible. We urge policymakers, investors, and other corporate stakeholders to take seriously the dangerous impacts of unrestrained inequality and their power to hold corporate America accountable.”

Highlights of Oxfam’s initial findings and analysis include:

• Corporations are making more than ever, with shareholder payouts at an all-time high: Companies in the CIF dataset showed 63% higher profits from 2018 to 2022, and their stock buybacks have reached a record high of $681 billion. Corporations in low-wage sectors, such as retail, continue to spend heavily on stock buybacks, with the highest spenders in the industry including Lowe’s ($39.5 billion), Home Depot ($39.2 billion), Walmart ($35.5 billion) and Starbucks ($21.7 billion).
• Few companies disclose minimum starting wage, while CEO pay continues to grow: Of the 200 companies analyzed, only 10 have made public statements in support of paying a living wage, though none of those 10 define what that looks like. To add, 15% of companies disclose their minimum starting wage, and on average, they represent $11.06 per hour, a nearly 50% living wage gap. On the other end of the spectrum, six companies paid their CEOs more than $100 million during at least one year between 2018 and 2022—Alphabet, Amazon, Intel, Oracle, Blackstone, and KKR.
• The retail sector stands out as most diverse and most inequitable: While 52% of employees in the retail sector are people of color and 56.8% are women, 69.9% of executives are white and 77.7% are men. This is evident in one of the most inequitable companies in the dataset—in 2022, Dollar Tree’s employee base was comprised of 55% people of color and 68% women, while the company’s leadership was 82% white and 75% men. Additionally, Oxfam's recent analysis of Amazon found that more than two-thirds of all employees at Amazon are people of color, but senior leadership is 63.7% white.
• DEI washing has taken on the same trajectory as green washing: The public push for DEI has led to greater transparency, with around 80% of companies disclosing workforce demographic data; yet, just about half (44%) have published DEI metric targets, and just 11% disclose promotion rates and 12% share retention rates—pointing to a worrying trend where surface level disclosures are used as a stand in for meaningful data that points to workplace equality progress.
• Tax avoidance and political lobbying reinforce inequality: Effective tax rates differ greatly across sectors, with the pharmaceutical and technology industries leading the way in chronically low tax payments (11.6% and 14.9% effective tax rates, respectively, in 2022). Both sectors also spend the most on lobbying, with technology leading at $114 million in 2022. Both types of expenditures contribute to greater inequality, as they route money and power away from low-wage workers and the social programs that protect them.
• Emissions data disclosures are improving, but corporate emissions are increasing: Climate has become a core sustainability buzzword while remaining a contributor to inequality, disproportionately affecting women and girls, as well as people of color. The majority (84%) of corporations in the CIF dataset now disclose emissions data. Still, average emissions across the group of 200 companies rose by 4% from between 2020 and 2021, and corporate attention on emissions has not led to meaningful net zero targets nor public Just Energy Transition plans.

To make measurable progress against the inequality crisis, Oxfam calls for stronger disclosure requirements that can better expose the inequality machine in US business practices. This pilot CIF assessment included indicators where sufficient public data remains unavailable, pointing to a need for more thorough public reporting to inform strong standards, advance corporate reform and alternative business models, and empower policymakers and the investor community to leverage inequality as a meaningful performance metric to which they can hold corporations accountable.

Methodology:

The pilot CIF analysis coalesces publicly available information from each of the 200 largest public companies in America using mandatory and voluntary company disclosures. This includes financial data from 2018 through 2022, as well as qualitative details from 2021—the most complete recent years on record for public disclosures at the time the data was gathered. Data sources include 10-K filings, proxy statements, company websites, and other public information databases. Each company is analyzed across four pillars through which corporations impact inequality—People, Power, Profits, and Planet—which factor in 15 subtopics and 80 corresponding indicators, including pay equity, board diversity, climate action, and more.

Oxfam is a global organization that fights inequality to end poverty and injustice. We offer lifesaving support in times of crisis and advocate for economic justice, gender equality, and climate action. We demand equal rights and equal treatment so that everyone can thrive, not just survive. The future is equal. Join us at oxfamamerica.org

/ENDS

Notes to editors:

Download the Corporate Inequality Framework (CIF) here.

Download the media brief, "Inequality, Made in America," here.

Download the CIF Investor Guide here.

In the absence of public company-specific living wage benchmarks, we set the benchmark at $20 an hour (with consideration of retirement, childcare, and healthcare). This is based on the population adjusted mean (provided by Living Wage for Us).