By Luuk Jacobs
By Eva Keogan
By Jonathan Max
By Luuk Jacobs
By Andy Milner
By Eva Keogan
Direct quote from Investment Week: The number of firms in the UK reporting their Gender Pay Gap (GPG) figures by the deadline has fallen by more than a thousand, amid claims firms have restructured businesses or transferred staff to avoid being obliged to report, or have ditched reporting altogether under the perception they will not face repercussions.
Is anyone working for a company which has done this? Is it time to name and shame as has been threatened before? Your thoughts are welcome.
This is quite worrying to read and it's not just Investment Week which has reported on this but to down size companies so they are below the 250-person threshold for reporting is incredibly cynical. Has anyone found evidence of this? Also, using Brexit as a smokescreen is not going to wash next year.
Gender pay gap reporting falls as asset managers unveil mixed results
WWW.INVESTMENTWEEK.CO.UK More than 1,000 fewer firms reveal figures
By Luuk Jacobs
The Investment Association just published their report "CLOSING THE GAP: ADDRESSING THE GENDER PAY GAP" which in part 3 looks at the "Industry Initiatives for Change". A very welcome publication that gives a good summary of what our industry (although I would think any industry) can do to close the gap, concentrated around:
Attraction and recruitment; Retention and advancement; and Monitoring
When reading it, I still come away with the feeling that it does not go beyond the standard and is not necessarily addressing cultural issues as indicated in my earlier blog or is moving away from the beaten path.
By Rob Carter
Brexit, MiFID II, GDPR, Gender Pay Gap and Diversity are the themes we consider top of mind currently which is why we’ve created the Summer 2018 AlgoMe Industry Pulse Report.
We wanted to get under the skin of some of these key events and burning issues for 2018. In doing so, we revealed some very interesting results and statistics.
Given a choice of 7 cities, Dublin, Paris and Amsterdam are the top three choices for Asset Managers, Fintech and Financial Services employees to relocate to following Brexit. While 54% would not consider moving as a result of Brexit.
When it comes to regulation; we are not surprised to find MiFID II and GDPR will affect over 60% of the roles in the industry.
Positively, 59% believe Gender Pay Gap Reporting will improve the career progression of women.
Please read the report for the full information and do get in touch if you would like to know more about your industry workforce.
Rob Carter, CEO, AlgoMe
By Luuk Jacobs
The latest Gender Pay Gap figures are not showing a nice picture with minimal shrinking of the overall figure from 9.7% to 9.6%. More than a quarter of companies pay women over 20% less than men based on median hourly pay. Just 1.5% pay male employees 20% less than their female staff.
Only a few companies have made progress and the majority continue to struggle or report even worse data. Especially the Asset Management industry shows a bleak picture.
This data however I believe paints a very black and white picture. We need further analysis and understanding of the underlying trends to be able to design GPG plans. We also need to learn from those companies which have managed to improve the gap and find out what the secret of their success if.
For example, analysis of April 2018 by the Office National Statistics (ONS, below graph base Annual Survey of Hours and Earnings) shows that the GPG for full-time employees between the ages of 18 and 39 years was close to zero, but began to widen for people over the age of 40; would this possibly be due to the fact that women take maternity leave in their thirties and feel the impact of this when returning? We are not sure.
This is where the true challenge lies. Current legislation does not oblige an explanation for the change in GPG or even a summary of how the GPG will be reduced. Neither is there a penalty for certain GPG levels or when the gap is worsening instead of improving. The hope was and is that this reporting will create certain self-regulation but now we are in this second year of reporting and it seems to be just a box-ticking exercise.
Nevertheless, various reasons for the existence of the pay gap are well understood, with some directly related with work
Many jobs traditionally done by women are lower paid A lack of genuine flexibility for employees at work Too few good quality part-time jobs
There are many other reasons which are not direct related to work and are more about caring responsibilities, with women still undertaking the majority of child or elderly care, reducing the participation of women in the workplace (either permanent or for a certain time). Some argue this to be a choice, however the Equalities and Human Rights Commission found that one in nine pregnant women had been let go from their jobs or treated so poorly they felt they had to leave. Equally lower participation of women (in general or in specific industries) itself is no reason for a GPG; the GPG would be zero if this lower participation would still result in an equivalent percentage of women then men in all positions and with equal pay for seniority.
Equally there is an increasing number of women who are self-employed (for reasons possibly related to the GPG or the reasons of its existence) and although not part of the GPG reporting statistics, also face the pay gap in this area.
More specific reasons for the GPG are the fact that the top jobs in most companies are still held by men (less than 30% of Board members are female and only 5% of the FTSE100 has a female CEO). Not only have these positions in general the highest pay but remuneration of these positions is accompanied by significant incentives and bonuses.
For Asset Management this is even further exuberated by Fund Managers having sometimes equal or higher pay than board members, whereas the number of women in these positions are few.
On the positive side in some cases a widening GPG might mean progress, as women are hired or promoted in entry level more senior jobs; this will initially widen the GPG before they move up the ranks and start reducing the GPG. Unfortunately, the GPG reporting does not show this.
So, what is the solution to reduce the GPG and ensure women will more equally participate in all level jobs and receive equal pay?
The direct improvements that can be made are well known
Reducing unconscious bias in recruitment Improve retention Offering more flexible working opportunities Encouraging shared parental leave Increasing support for women returning to work
Iceland even goes as far as implementing a rating of job positions on among others, “physical strain” and “responsibility”. If two employees doing a job with the same score and are not being paid the same, the company has to fix it.
I believe however that we should be looking beyond this and start influencing for example the role of men and women in family life, household and society; as long as women continue to take the caring responsibilities, their participation and likely career progression will for some time stall (as for any longer leave taken by men or women). In the current environment of technological change and innovation certain skillsets become fast redundant or less important and “catching up” will even be more challenging.
If we accept the choice of women (and their spouses!) to (temporarily) take the responsibility for caring roles we should equally encourage:
To stay connected with the work environment, while fulfilling these caring roles, by ongoing training and part-time participation ie make it an integral part of parental leave; To oblige companies to provide training during (parental/caring) leave ensuring that upon return the skillset remains suitable for the position in which the woman returns (and leave can’t be an excuse for career stalling or even worse redundancy); To make parental leave by definition shared, yes controversial but by ruling that parental leave is only so long as it is taken by each parent equally, would change the dynamic (and choice).
An alternative route could be to make GPG part of the ESG score of a company. As long as the weighting would be significant, this would definitely be focussing the minds of the Board and Executives, as their investment attractiveness would worsen with the height of the GPG. Even better it would open the dialogue and the need for creating GPG plans (if it is not written down it does not exist). ESG has taken a long time to get the right attention but equally has brought the focus that was needed to make improvements. Something that GPG would fare well by. LGIM has taken a brave step in voting at AGM’s against Board appointments for failing to boost the number of women in their boardrooms.
I strongly believe we need to move away from just looking at the numbers if we want to create lasting change and just creating new policy is not doing it. We must challenge the traditional role of men and women in society, not just with regards to caring roles but also for example education. Just beating the drum will not move the dial but longer lasting (forced) dialogue through routes such as ESG, could push the boundaries.
We need to look beyond the parameters of the report and move outside of the box as a matter of urgency otherwise we will still talk about the gaps in ten or fifteen years and just say ‘nothing has changed much’.