Work harder to ensure women mean business

Moves are being made to ensure that enough females are in senior roles in finance firms, writes Susannah Donaldson

Many financial services firms across the UK have improved their hourly gender pay gap (GPG) by 1-2% since reporting requirements were introduced, but the sector still has a long way to go in order to address continuing discrepancies.

Analysis carried out by Pinsent Masons shows that the financial services sector continues to have one of the widest average GPGs compared to other sectors. This is particularly prevalent when considering the number of women in senior positions compared to the number of men in higher paid roles - however, firms across the sector are applying a data-driven approach to make effective change and close the gender pay gap.

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Approximately 507 employers across the UK financial services sector reported their gender pay gap in 2023-24. On average, the median hourly pay gap is sitting at 21%, while the highest hourly median pay gap reported in 2023-24 is 61.8%, which is significantly higher than the sector average.

The gender pay gap needs addressing, says Susannah DonaldsonThe gender pay gap needs addressing, says Susannah Donaldson
The gender pay gap needs addressing, says Susannah Donaldson

Many companies have improved their median hourly gender pay gap by up to 2% since the reporting obligations were introduced in 2017. Others have demonstrated a huge improvement, for instance, one company has decreased its median hourly pay gap by over 24% from 44.6% in 2017-18 to 19.8% in 2023-24. This is hopefully a sign of things to come in the UK financial services sector, despite the average still being less favourable overall compared to other sectors.

The figures also show that there is a 40.18% difference in the mean bonus payments to men compared to women, an increase from 30.56% as reported in 2022-23. The difference in the median bonus payments between men and women is 28.9%.

Many companies within this sector still identify a lack of equality in the number of men and women in senior positions and are targeting this by setting goals to increase the number of women in these positions. However, it has been reported that, for some companies, there are now more women than men in junior and lower paid roles.

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To tackle these issues, companies are continuing to set targets and establish regular reporting to track progress in internal and external recruitment. Gender analysis by companies has been said to shape talent development offerings.

Mentoring is playing a part in bringing on the next generation of women in business (Picture: Adobe)Mentoring is playing a part in bringing on the next generation of women in business (Picture: Adobe)
Mentoring is playing a part in bringing on the next generation of women in business (Picture: Adobe)

There continues to also be a focus by various companies on the recruitment process and implementing gender neutral language in job descriptions to attract more female applicants. Some companies are even using gender decoding software, with other steps including ensuring that there is a female representative on interview panels to allow for balanced decision making.

In terms of performance management, some companies are also reducing or removing self-assessment elements of reviews, as research has shown that self-assessment can increase gender disparity. Some companies are also monitoring the proportions of male and female employees at the promotion stage, and ensuring that there is transparency with employees on the promotion process.

Leadership training, mentoring and sponsorship programmes are also playing an important role in financial companies seeking to promote more women to senior leadership roles. Companies are also increasing leadership accountability to ensure that those in senior roles are accountable for diversity, equality and inclusion progress within their companies.

Susannah Donaldson, Partner and Co-Head of the global Equality Law practice at Pinsent Masons

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