Research suggests that female directors of top finance firms are paid £500k less than their male counterparts.
This research - after analysing workforce data from the FTSE 350 financial services companies - highlights recent signs of progress but emphasises that there is still a way to go to obviate gender inequality.
Reasons to celebrate are that as of February, according to the 30% Club, there are no FTSE 350 companies in the UK with an all-male board. However, as this also happened previously in May 2020 only to return to all male boards the following month, it is essential that this time around they are gone for good by maintaining and continuing to increase female representation at board level.
The Hampton-Alexander Review has reported finding that the number of women on FTSE 350 boards has increased by 50 per cent in just five years. By 11 January this year, there were 1,026 women on FTSE 350 boards. This is an increase of 344 since the previous review in 2016.
The FTSE 100 achieved 36.2 per cent of female representation, whilst the FTSE 250 achieved 33.2 per cent, equating to the FTSE 350 now having women in 34.3 per cent of board positions.
It may seem that getting rid of all-male boards and having 34.3 per cent of board positions held by women is putting gender equality within grasp - but according to analysis by Fox & Partners, from September 2020 women held just 7,552 of 50,639 senior management jobs at financial services firms. This equates to 15 per cent of such roles.
Gender diversity was lowest at CEO level of financial services businesses - with women holding just 8 per cent of CEO positions and just 8 per cent of chair roles. In addition, the average pay for female directors at FTSE 350 financial services firms was found to be approximately £247,100 - almost £500,000 less compared to the £722,300 paid to their male counterparts.
Catriona Watt - Partner at Fox & Partners - stated that women were still under-represented in the boardroom and added:
“There is no quick fix, but firms need to ensure they have as part of their planning a strategy that seeks to break down barriers that have typically prevented women from progressing to the top.”
Mary O’Connor - Senior Partner at KPMG UK - remarked that women still faced ‘structural and cultural barriers’ to senior roles and figures like ‘34 per cent of board members are women’ can downplay these barriers.
She went on to say:
“Achieving the review’s 33 per cent target at boardroom level marks great progress, but it’s vital we have a strong pipeline of female talent rising through the ranks.”
Arun Batra - Partner at EY; CEO of the National Equality Standard and adviser to the Parker review - previously told People Management:
“Being open and honest on this issue is a crucial step to diversifying the boardroom. For years we’ve known that diversity of thought and perspective is imperative to growth, which is even more the case during the challenges of Covid-19 where there are new uncertainties and no precedent to follow. We’re in uncharted territory and the long-term recovery from the current global health crisis will require companies to leverage the strengths of all their people.
Embracing the value and importance of boardroom diversity will be critical in the long term and those that fail to do so risk being left behind.”
He urged employers to help inspire future generations of talent by creating a culture wherein all people feel they can succeed - adding:
“Such a culture can help nurture a productive workforce, which ultimately is an important input to achieving business growth.”
