September

26, 2017

Alphabet Inc./Google
Eric E. Schmidt
Executive Chairman
1600 Amphitheater Parkway
Mountainview, CA 94043

Dear Mr. Schmidt,

On behalf of our clients and fellow investors, I would like to express my continued concern over Alphabets
management of gender pay equity.

As you may recall, we met this spring at Alphabets annual meeting of shareholders, where our shareholder
proposal, co-filed by Baldwin Brothers and Proxy Impact, asking the company to disclose and close its gender
pay gap was put to a vote for the second time. Given the outsized voting power of company insiders, the
majority of whom are male (e.g. Mr. Brin and Mr. Page own 11% of the company but control 51% of the vote),
the proposal was not approved. Nonetheless, it received strong support from non-insider shareholders.
During that meeting, I asked for a continuation of what should be, and had begun as, a constructive dialog. But
despite your indications that the dialog could continue, I was deflected after the meeting by the very person to
whom I was referred.

The disclosures we have sought and continue to seek have become common practice in Silicon Valley and
amongst your technology peers. Yet Alphabet has refused to disclose the companys gender pay gap in a
transparent, quantitative manner. Instead the company has relied on platitudes that there is no gap, trust us.

Today, Alphabet is under fire for its lack of transparency on gender pay equity, making it subject to federal, class
action, and shareholder actions. In two successive years, Alphabets male dominated management team has
voted against gender pay equity proposals. And the recent episode of a Google engineer issuing a blatantly anti-
women manifesto can be seen as a reflection of a corporate culture Google has advanced. At the same time,
the Department of Labor has alleged extreme gender pay disparity.

And most disturbingly, the New York Times recently made public leaked employee-gathered data suggesting
major gender pay gaps across Google. Concerned shareholders, with an eye on the long-term health of their
holdings, cannot turn a blind eye to the growing number of regulatory and legal actions targeting Google on
gender-pay equity. As investors, we seek to encourage leadership on gender equity, not the block and tackle
tactics we have seen thus far.

In particlular, the recent revelation reported in the New York Times gives us cause for concern. The 1,194-
person employee-led and then leaked spreadsheet provides a snapshot of base salary data for six pay levels,
revealing a gap across five of the six levels, and higher bonuses for men in four of the six levels. And while I
understand this is an incomplete measure of company data, investors are left relying on such disclosures in the
absence of company transparency and accountability.

Now, we read in the New York Times that Google is claiming near 100-percent gender pay equity. However, the
single statisticthat women make 99.7 cents for every dollar a man makeswas provided in isolation with no
context on how the figure was derived, qualified, limited or otherwise shaded. And while this is the kind of
disclosure Arjuna Capital has sought for two years, the circumstances and delivery of that fragmentary
disclosure leaves us with more questions than answers. Particularly when the same publication printed data
from non-official Google sources that contradicts managements claim.

Now that Google has made this material and contradictory disclosure to the Times, claiming near 100 percent
gender pay equity, it is incumbent on the company to come forward with a formal report so that investors may
judge its accuracy and meaning. This is of particular importance, as the employee data is at complete odds with
the single number the company quoted to the Times. A formal report would clear up any possible perception
that Googles disclosure to the New York Times is in some way a distortion or misstatement of material fact.
Failure to do so could be considered an omission of a fact of material interest to shareholders who have long-
term wealth at risk.

May I suggest the company start by addressing the following questions?

Why was that data provided to the New York Times not disclosed prior to or at the annual meeting in
response to our shareholder proposal, given the analysis was conducted in January?

Why was only 95% of the workforce reported on?

Why were highly-paid vice presidents and above in the C-suite excluded from the analysis?

Why did Alphabet refuse to provide a breakdown of how it arrived at that calculation?

What is the formula that you used to arrive at your statistic about gender pay equity?

Why is there such a disparity between the employee data leaked to the Times, the allegations from the
Department of Labor of extreme pay disparities, and the companys own disclosure to the New York
Times?

These questions and related concerns remain unaddressed.

Alphabet should welcome the opportunity to clear the air on the issue of gender pay equity and move forward
with whatever corrective steps are necessary, including formal reporting. Stalling tactics do nothing but confirm
suspicions that the company has either something to hide or such a callous attitude toward women that it cant
be bothered to address the issue of gender pay equity at the level and in the manner it deserves.

Sincerely,




Natasha Lamb
Managing Partner
Arjuna Capital