Gender Pay Gap - The Financial Services Sector - The Story and the Data Behind It - 21 March
Mark.Freed / 23 Mar 2018
The financial services sector employs roughly 1.2m people in the UK. 40% of those employed in the sector are women. There is no shortage of female talent.
The gender pay gap reports of financial sectors show that the problem is the lack of women in senior higher paying roles.
Although the industry prides itself on being a meritocracy, most of the senior roles in the industry and highest earners are men.
How big is the gap?
The reports show that only 26% of the top quartile earners across the industry are women. That varies from less than 20% in investment banking and wealth sectors, to 36% in the more, and often lower paid, retail focussed sectors.
If you took the 300,000 top quartile earners from a representative cross section of firms, only 80,000 of them would be women.
How big is the challenge?
Many firms in the sector aspire to be gender neutral in their top tiers:50/50 by 2020. If this was an industry wide goal, to achieve it, we would need to promote or recruit and then retain 70,000 women to deliver those senior roles. i.e. almost double current female representation at senior levels.
So what can we glean from the current gender pay gap reports as of 21 March? Not as much as we will this time next year when we will be able to see who has and who has not made progress.
Let's highlight the top performers and give a gentle nudge to those not doing so well.
- The Building Society sector seems a good place to work with an average pay gap of 31% and a bonus gap of 38%. 42% of top earners are women.
- Many of the Insurance Companies who have reported are retail focussed and have good figures. Admiral and Unum are leading the pack with over 35% of their top earners being women, compared to Jardine where the figure drops to 17%.
- International Banking Groups and Investment Banks. Only a handful of Banks in this sector have reported but we should highlight Goldman Sachs and Standard Chartered who I believe will be shown to have comparatively good figures despite huge bonus gaps of around 70% and only 20% of their top quartile basic pay earners being women.
However the biggest congratulations should go to State Street. The Fearless Girl is standing a little taller today with 32% of their top quartile earners and only an 18% pay gap they are by a significant margin the leaders in the sector, so far.
- If you are in Asset and Investment Management move to Scotland. Franklin Templeton, Scottish Widows, Aberdeen and Baillie Gifford are all posting better figures than the London based firms. Although special mention should be made of Legal & General Investment Management for standing by their ambition to be 50/50 by 2020 and the strategies they are putting in place to affect that change.
An interesting statistic. Old Mutual were praised for their performance in the Hampton-alexander review. They had one of the best female representations on their boards, exco and exco minus one. In gender pay gap reporting they are at the bottom of the sector with only 15% of women in their top quartile earners.
- Private Wealth. Let's just say the whole sector needs a significant nudge and in particular the independents.
- FCA and Bank of England are doing well but not as well as the London Stock Exchange with an ordinary pay gap of just 9% and bonus gap of 14% - they are one of our stars.
- The Retail and Service/Operations firms are also doing well with an average 37% female representation at senior levels. Challenger Banks are not doing as well as the traditional banks in terms of women at the top.
To finish on a high point: M&S Bank (run by HSBC) with 66% women in its higher earners and Santander Operations with 56% are the two organisations that have more women than men in the highest earners.
It can be done....
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