International Equal Pay Day 2024 

International Equal Pay Day, observed annually on 18^th September, is a crucial reminder of the ongoing global struggle for gender pay equity. This day was established by the United Nations to highlight the persistent gender wage gap, which sees women earning less than men for the same work, a disparity that exists in every country and across all sectors. The occasion serves as a call to action for governments, organisations, and individuals to address these inequalities. Achieving equal pay is an important milestone for human rights and gender equality. It takes the effort of the entire world community and more work remains to be done (International Equal Pay Day | United Nations).

The gender pay gap is influenced by various factors, including occupational segregation, discrimination, and the undervaluation of work typically performed by women. For instance, women are often overrepresented in lower-paying industries and underrepresented in higher-paying leadership roles. Additionally, societal norms and expectations around caregiving responsibilities frequently lead to career interruptions for women, affecting their long-term earning potential. Addressing these issues requires comprehensive strategies that encompass policy changes, corporate accountability, and societal shifts in attitudes towards gender roles. Achieving equal pay for equal work is not only a matter of justice but also an economic imperative.

Since 2006, the World Economic Forum (WEF) has tracked gender parity in worldwide economic opportunities, education, health and representation in political leadership and the 2024 Global Gender Gap Index data shows that while no country has achieved full gender parity, 97% of the economies have closed more than 60% of their gap, compared to 85% in 2006. Iceland (93.5%) is again ranked 1st and has been leading the index for a decade and a half. It also continues to be the only economy to have closed over 90% of its gender gap. Out of the remaining nine economies in the top 10, eight have closed over 80% of their gap. However, it will be another 134 years before we achieve full gender parity on labour force participation, salaries and representation in leadership positions (Global Gender Gap Report 2024 | World Economic Forum).

Price Waterhouse Coopers (PwC) produce the Women in Work Index which has five indicators: the gender pay gap, female labour force participation, the gap between male and female labour force participation, female unemployment, and female full-time employment rate. The Women in Work Index 2024 report reveals slow progress towards gender equality at work across the Organisation for Economic Cooperation and Development Countries (OECD), with an average gender pay gap of 13.5% and at this pace of progress, it will take more than half a century to close the gender pay gap across the OECD. The UK, which experienced the largest annual fall on the Index of any OECD country, dropped four places from 13^th to 17^th and analysis shows that, on average, for every £1 earned by a man in the UK, a woman earns 90p despite having a similar personal and professional background. This highlights the significant role that biases and structural inequalities in the workplace play in driving gender pay disparities. Closing the gender pay penalty could also unlock significant economic gains and it is estimated that if women in the UK no longer faced a gender pay penalty, the potential increase in women’s earnings could be up to £55bn per year. Moreover, it could encourage more women to join or rejoin the workforce - a 5% increase in the total number of women in employment could boost UK GDP by up to £125bn every year.

Despite the fact that in entry-level roles, women are achieving parity with men or even holding the majority in certain sectors, their representation in leadership positions remains significantly lower due to various biases that obstruct their career progression. In 2023, LinkedIn researchers estimated women held less than one-third of leadership positions worldwide. Initiatives for developing female leaders, sometimes called 'talent accelerators' or 'leadership development programmes', aim to promote women into leadership positions and keep them there.

The UK has climbed to second in the international rankings for women’s representation on boards at FTSE 100 level, with new data showing nearly 40% of UK FTSE 100 board positions are now held by women, compared with 12.5% 10 years ago. The data was published in a new report by the government-backed FTSE Women Leaders Review, which monitors women’s representation in 24,000 positions on FTSE 350 Boards and in leadership teams of the UK’s biggest companies, building on the success of the previous Hampton-Alexander and Davies Reviews (Sea-change in UK boardrooms as women make up nearly 40% of FTSE 100 top table roles).

The Cranfield University Female FTSE Board Report 2022 reported that the number of women in senior Non Executive Directorship (NED) roles has also increased. There are now 18 FTSE 100 companies with women Chairs, albeit two are designate/interim and two women now chair two FTSE 100 companies. The number of women holding Senior Independent Director (SID) roles jumped from 25 to 33 this year and 39% of board committees are now chaired by women - an increase of 4% on last year. The report confirms that overall women hold 413 directorships across FTSE 100 boards now - the increase coming primarily from female Non Executive Directorships (NEDs). The number of women in Executive Directorships (EDs) has increased marginally from 31 to 36. There are still only 47 women holding executive directorships across FTSE 250 companies for the third year running. The report concludes that it is time for Chairs and Boards to step up in their efforts to accelerate the rate of progress of women in the executive pipeline by engaging more actively in the executive succession planning process.

How to achieve a better gender balance in the workplace and accelerate efforts to close the gender gap:

• Analyse pay data, identify any gender gaps, and publish findings to focus attention on important gender equality issues, for example, a lack of flexible working, occupational segregation and pay discrimination. Use this CIPD Gender pay gap reporting guide.
• Prioritise succession planning and talent management of women across the organisation to help them receive broad experience across the business, leading to more women being appointed to more executive roles such as Chair, CEO and CFO.

• Address the challenges facing pregnant women and working mothers e.g., allowing more flexible working and support for childcare.
• Provide more opportunities and support to enable women to return to work after a career break including training and mentoring programmes.
• Review induction programmes to ensure new starters feel welcome, informed, and aware of the support available.
• Review your workforce policies to ensure that everyone feels they are treated fairly and supported in their development.
• Review recruitment and selection processes including using gender neutral language, setting up a diverse balanced interview panel, creating a balanced shortlist for management roles, consider using anonymous CVs.

Government and business leaders need to continue to work together to address any underlying gender inequalities and close existing gender pay gaps. By raising awareness and taking action, we can move closer to a world where everyone, regardless of gender, receives fair compensation for their contributions.

Lizzy Turek

Client Research Associate