The Treasury Committee has published its report following its Women in Finance inquiry, which sought to identify the barriers to women entering and progressing in the financial services industry. It also examined the value to financial firms of having greater gender balance across all job grades and functions.
The average gender pay gap in UK banks and building societies is 35%, and 52% for bonuses. The gap becomes wider in higher wage brackets; for example, the gender pay gap for people earning £1 million or more is 91%, due to the disparity in the numbers of men and women in senior roles. However, research has found that firms with higher numbers of women in senior positions perform better than those with lower numbers of women in senior management, with returns above their national industry average.
The Committee’s key recommendations include:
- Bonuses should be assessed against objective and formulaic criteria to abolish the “alpha male” culture, where it is perceived that men argue more forcefully in bonus negotiations.
- More senior men should work flexibly in order to remove any stigma associated with flexible working.
- Firms should be encouraged to publish their strategies for closing the gender pay gap.
- Partners and subsidiaries should be included in gender pay gap reporting.
- Firms should work to eliminate unconscious bias, which can lead to staff recruiting and promoting in their own image.
- Girls should be encouraged to study relevant subjects at school to increase the number of women entering the sector.
The Government’s response to the report is awaited.