Experts have highlighted HR’s critical role in changing organisational cultures and processes, stating that more needs to be done to end the ‘old boys’ club’ at the top.
New research from the New Street Consulting Group shows that, on average, female directors earn almost three-quarters less than their male counterparts.
The report, which studied the remuneration of nearly 950 directors - including more than 700 non-executive board members - found that female FTSE 100 directors currently earn an average of £237,000 per year - 73 per cent less than the average pay for male FTSE 100 directors who receive £875,900 per year.
The reason for the large discrepancy at the board level of FTSE 100 companies is due mainly to the fact that 91 per cent of female directors hold non-executive jobs rather than executive roles - with non-executive positions tending to have lower remuneration.
The pay gap between female and male executive directors was even more evident - with female executive directors earning an average pay of £1.5m per year in comparison with £2.5m per year for male executive directors.
Dr Scarlett Brown - Corporate Governance Lead at the CIPD - commented that there was still a long way to go to get women into executive roles.
She said:
“HR has a critical role to play in making this change happen - and highlighting aspects of an organisation’s systems, culture and processes that are preventing women reaching the top leadership positions.”
She added:
“HR also needs to ensure line managers are trained on these approaches to support fair and inclusive career progression.”
Claire Carter - Director at New Street Consulting Group - stated:
“Great progress has been made in bringing more women onto boards, but this research shows there is much more to do. Focusing solely on the percentage of directors who are women is not enough when trying to approach equality.
Most businesses want to end the old boys’ club that exists at the top. The key to doing that will be ensuring that women have more executive responsibilities and are trained and prepared properly for taking on that responsibility. Allocating them the right assignments and projects is essential to that process.”
Darren Hockley - Managing Director of e-learning provider DeltaNet International - said:
“HR must work more closely with executive teams to address equal and fair pay to stamp out social injustice.”
Explaining that pay equality responsibility does not just lie with HR - it requires support from everyone in the organisation, he added:
“More executives need to step up and become an ally for their female colleagues. If they are aware of injustice, then they need to speak up and support their female colleagues to get paid what they deserve.”
