It's been two years since the government announced plans to force companies with more than 250 employees to publish their gender pay gap. But it seems like a lifetime ago.
The new rules came into effect in April although, to date, few companies have published their data.
This requirement to publish gender pay data was welcomed in many quarters as a positive move by the government. I believe it will go a long way towards tackling both the symptoms and causes of gender inequality in the workplace.
However, amid all the other issues occupying the minds of business, not least Brexit and political uncertainty, it’s important we stay focused on this issue and don’t allow progress on closing the gender pay gap to slip.
This shouldn’t be viewed as a compliance exercise and it’s not even just about doing the right thing. It also makes good business sense.
In my own firm, diversity and inclusion are critical to our future success.
Collective focus is crucial
Without a collective focus, our research shows it could take 24 years to close the UK’s gender pay gap.
The new level of transparency called for by government should help to drive greater accountability across UK businesses and, in turn, prompt action to address the underlying causes. It’s not only the numbers that are important here – it’s the changes that businesses are making off the back of them and whether they understand what their data is telling them.
Be as open as possible
Businesses can only tackle gender pay differences if they really understand what is happening in their business in the first place, and therefore where they need to focus their efforts. This is a complex issue and calculating pay averages for the whole workforce won’t necessarily reveal where the issues are.
Therefore, the more detailed information companies can publish, such as differences at a grade level and details of actions they are taking to address gender inequality, the better.
I would encourage businesses to be as open as possible. Publishing information on gender pay differences externally will create the strong sense of accountability needed for businesses to drive real action. But we shouldn’t forget that gender pay analysis is only one of a number of measures that organisations should be monitoring as part of their efforts to make sure their workplace has equal opportunities for all.
At PwC, we have been voluntarily reporting our gender pay gap publicly since 2014, which has allowed us to understand the imbalances in our business and to do something about it.
It’s encouraging to see that our gender pay gap is narrowing. We know that a sizeable part of our own pay gap is a result of having fewer women in senior positions, so this is an area where we focus our efforts.
Job differences between men and women, both across industries and job roles, are generally one of the biggest factors contributing to the gap in earnings.
Our research shows that financial services has the largest gender pay gap at 34 per cent, whereas public administration and support services have the lowest at 15 per cent and 13 per cent, respectively.
Fear of reputational damage
Organisations with high gender pay gaps may fear the reputational risk by disclosing the figures, but the key is to explain clearly why the gap exists and what is being done to address the causes and close it. The companies that do so are much more likely to be seen as taking it seriously and viewed in a positive light.
There is no easy shortcut. We must make the effort to take sustained collective action if we are to make true gender parity a reality in the UK workplace.