What does your gender pay gap say about your business?

 
Ian Dowd
London City Workers Walk Across Thames Bridges
Pay gap reporting will lay bare companies' attitudes to equality in general (Source: Getty)

Despite a tumultuous time in recent weeks dominated by the EU referendum, the gender pay gap is still very much on employers' minds.

It's an issue that companies can't continue to ignore - and not just because of growing public scrutiny. Employees will increasingly look at published gender pay gap data to reveal a company's true colours before accepting job offers.

With pay gap reporting being mandatory from this October, all private and public sector employers will need to publish prescribed information about their pay disparity. The public sector is currently leading the way, with Sadiq Khan announcing a plan for pay equality across the Greater London Authority just last month.

Many private businesses are following suit. Companies including Pepsi, Deloitte and Amazon recently signed a pledge to address pay inequality.

Read more: Closing the gap - will gender pay gap reporting be effective?

While it is great to see so many organisations publicly joining the fight for greater gender equality, actions will speak louder than words. The gender pay gap reporting won't just highlight salary inequality between men and women, it will also reveal what an organisation stands for and the values it upholds.

Some companies might think that their gender pay gap can be solved by simply paying women more. But such sweeping solutions do not address the root causes of gender inequality within a business. Benefits packages, bonus payments or working hour arrangements are just some examples where female employees might still draw the short straw despite earning the same as their male colleagues.

Equally, family commitments such as taking maternity leave or childcare commitments mean women may not feel able to push for promotions at the same time as their male counterparts who have not taken long leave. But it is important that gender equality goes both ways. For example, equality between maternity and paternity leave should mean men are able to take more time to spend with their families.

Read more: Gender pay gap narrowing? Not if you're retiring this year

Yet inclusivity doesn’t end at gender. A company’s pay gap and the way it seeks to address any inequality is also indicative of its general attitude towards employee diversity.

Companies implementing policies that seek to address pay gaps show a greater commitment to providing equal opportunity regardless of race, gender, sexual orientation or disability. In turn, businesses are likely to benefit from a wider pool of candidates who are attracted to working at a company with such values. This is especially important at a time when companies are struggling to recruit and retain employees with the right skillset.

It is understandable that some organisations are nervous about their pay gap reporting. It won’t just show pay disparity but also provide a view into the very heart of their organisation and what it stands for. Companies that embrace diversity and equality have nothing to worry about other than getting familiar with the new process.

However, for those companies unhappy with their results, they should see it as an opportunity to review and shift their diversity policies and create a culture of inclusivity. After all, equality should go far beyond just the pay slip.

City A.M.'s opinion pages are a place for thought-provoking views and debate. These views are not necessarily shared by City A.M.

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