Three Biggest Pay Gaps Between CEO, Workers Belong to Women

Stay current on changes and developments in corporate law with a wide variety of resources and tools.

By Andrea Vittorio

There’s a different kind of pay gap for the women atop Weight Watchers International Inc., Mattel Inc., and Abercrombie & Fitch Co.

It’s between them and their rank-and-file workers.

Companies are reporting for the first time this year ratios comparing the CEO’s pay to that of the median employee. The three biggest pay ratios so far are at these three companies run by women, according to a ranking of companies in the Russell 3000 index by researcher Proxy Insight.

Topping the list is Weight Watchers CEO Mindy Grossman, who in her first year leading the company got paid 5,908 times more than the median. Mattel’s now-former CEO Margo Georgiadis ranked second, with a ratio of 4,987-to-1. Abercrombie & Fitch’s CEO Fran Horowitz has the third-highest ratio in the index at 3,431-to-1.

Female chief executives are rare to begin with, according to governance data provider Equilar Inc. Women represent less than 5 percent of all CEOs in the Russell 3000 index, Equilar data show.

“I don’t think it’s fair to say in any way, shape, or form that it’s because they’re women,” Dan Marcec, Equilar’s director of content and communications, told Bloomberg Law.

Their ratios are so high in part because all three women were new to their CEO jobs last year, so they each got signing bonuses that temporarily pushed up their pay. All three companies also employ mostly low-wage workers, which affects the other side of the pay ratio.

Workforce Makeup

Almost two-thirds of Russell 3000 companies have made their pay ratio disclosures as of Proxy Insight’s April 30 analysis. The reporting is required under part of the post-financial crisis Dodd-Frank law.

Companies like Weight Watchers, Mattel, and Abercrombie & Fitch would have a high pay ratio regardless of who their CEO is because of the makeup of their workforce, Marcec said.

More than half of Mattel’s global workforce is in manufacturing, mostly outside the U.S., where wages are much lower, the company said in its disclosure. The Barbie maker’s median employee worked in a factory in Malaysia and got paid $6,271.

The CEO, Georgiadis, meanwhile made more than $31 million, including a one-time hiring award that skewed her pay higher. Mattel reported another ratio that didn’t include the equity grants she received in relation to her hiring. That ratio was 1,527 to 1.

Georgiadis led Mattel for about a year before leaving to become CEO of the company behind

Retail Workers

At Weight Watchers, Grossman’s pay package likewise included a one-time equity award valued at $26.3 million, partly meant to replace deferred compensation she forfeited by leaving her previous job running shopping network HSN Inc.

Another reason Weight Watchers’ pay ratio is high is that the majority of its employees are part time and work less than three meetings a week, the company said in its disclosure. Its median employee got paid $6,013.

Ratios are also expected to be higher in industries like retail that rely on part-time and seasonal workers. That’s the case for clothing retailer Abercrombie & Fitch.

The company said its median employee, who earned $2,991, goes to school full time and works part time for an average of seven hours per week, nine months of the year. Many of the students who staff its stores are among Abercrombie & Fitch’s core customer demographic, it said.

“I remember making that in college,” Marcec said, adding that the ratio “doesn’t really tell you much about Abercrombie & Fitch’s corporate workforce or their full-time store employees.”

About one-third of Horowitz’s more-than-$10 million CEO pay package at Abercrombie & Fitch came from stock she got for being promoted to CEO last year.

To contact the reporter on this story: Andrea Vittorio in Washington at

To contact the editor responsible for this story: Fawn Johnson at

Copyright © 2018 The Bureau of National Affairs, Inc. All Rights Reserved.

Request Corporate on Bloomberg Law