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14 October 2016

Finance firms committ to tackling the gender pay gap

The UK's leading financial firms have published targets for improving gender diversity in senior roles, and narrowing the gender pay gap along with their strategies for achieving those targets over the next five years.

Of the 72 firms who have signed the Treasury-backed Women in Finance Charter since it was set up earlier this year, 60 have committed to filling 30 per cent of senior roles with women by 2021. Eight companies have included an ambition or target relevant to the gender pay gap in their commitment.

Actions firms have committed to include reducing the gender pay gap at senior management level, review and monitoring of pay levels by gender, and publishing gender pay gap information in advance of the April 2018 publication date.

Financial services is the UK's highest paid sector but also the one with the widest gender pay gap, at 39.5 per cent,  compared with 19.2 per cent across the economy as a whole.

The Women in Finance Charter was established in March in response to the report from Virgin Money’s Jayne-Anne Gadhia, which found that women currently hold about 23 per cent of positions on UK boards but only 14 per cent of executive committee roles.

Firms signed up to the Charter commit to four actions to improve gender diversity: setting internal targets for gender diversity in their senior management; publishing progress reports annually against these targets; appointing a senior executive responsible for gender diversity and inclusion; and linking their executives' remuneration packages to gender diversity targets. As none of these relate directly to the gender pay gap, it is heartening to see that some signatories recognise the need to tackle the challenge head-on.

In response to the publication of targets, Theresa May, the prime minister, said that the UK's "world leading" financial services sector could "do even better if it made the most of many talented women who work in finance".

"It is good news that so many firms have signed the Women in Finance Charter and are now dedicating themselves to tackling gender inequality," she said. "They recognise the business case for doing so and with ambitious targets to deepen the female talent pool, these firms are leading the way."

"I want to see a diverse sector run by talented men and women and I look forward to seeing many more businesses promoting women and helping to make the UK the best place in the world to do business," May said.

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