The margins in the Legend inserted by default with ArcGIS PRO are too tight to the text for layer and group names. How can the margin be adjusted? The Legend Properties -> background pane presented on the right hand side of application window does not adjust the margins.
After multiple chat sessions with ESRI we found the answer.
Select the legend in the layout, and select the Format menu at the top ribbon. Adjust the Gap X and Gap Y values to suit your needs.
Being an old ArcGIS desktop user I was looking in the pane on the right because that is where everything else is. The legend in old desktop had good default margins anyway that I never adjusted.
Adage: when you can't find it... look up