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Diversity in Recruitment: How Firms are Taking Measures to Close the Gender Pay Gap

Written by: Evie Courtier
Published on: 12 Jun 2023

Diversity in Recruitment

Advocating for gender pay in the workplace is a challenge across the finance and accountancy sector. As the UK’s leading specialist accountancy and finance job site, GAAPweb remains committed to closing the gender pay gap and promoting gender equality across the finance profession.

Women In Finance Charter - Representation:

Women In Finance Charter

To champion efforts to promote gender diversity, GAAPweb have been a signatory of the Women in Finance Charter through their annual Women in Finance pledge since 2016, when the Charter was launched. The Charter aims to empower productivity and harness the talents of women in financial services by tracking and promoting the representation of women in senior roles in financial services. In addition, we have conducted a detailed exploration into diversity within the sector through our annual Salary Survey.

As noted in the HM Treasury Women in Finance Charter, “global economic and geopolitical turmoil present a complex and challenging backdrop for the financial services industry. Multiple levers will need to be pulled to prevent diversity and inclusion (D&I) sliding back to being considered a non-essential activity – organisations must clearly communicate how diversity and inclusion connects to strategy, leaders must lead inclusively to mainstream DEI, managers must demonstrate allyship and advocacy – and to bring the importance of DEI to life and maintain focus and rigour at the micro level.” Businesses must be as committed to D&I initiatives as they are to other areas of business, taking on the hard work to deliver all-important change.

After a plateau of progress in 2021, where female representation in senior roles remained flat at 33% for the first time since the charter began, signatories have now recovered lost ground, reaching an average of 35% in 2022. The 2% progress is the largest percentage increase in the history of the charter, presenting great strides in the move towards parity for women in senior roles. The GAAPweb 2023 salary survey resonates with this achievement. Whilst the challenge to achieve gender parity in senior positions continues, 2023 brings us subtle breakthroughs, with 42% of Finance Business Partner roles and 52% of Finance Managers now held by women. On the other hand, male workers still monopolised CFO roles, with an 82% majority, and 67% of Finance Directors roles were conducted by men.

As highlighted within our salary survey, the average salary for male respondents stands at 22% higher than female respondents, with the average salary for female accountancy and finance professionals standing at £58,234. Since our survey analysis began in 2018, the pay gap has narrowed by 4%. If this rate of change continues, salary parity between genders won’t be achieved until 2051.

The Top and Bottom - Leading Sectors and Groups:

As noted by Women in Finance, there’s a widening chasm between top banking sectors, such as building societies and UK banks, vs the bottom (global/investment banks and asset managers). With the gap increasing from 18% to 22% in regards to representation, this issue remains a focal point at the forefront of discussion. For the first time, the top quarter of firms (52) signed up to the Charter that conduct regulated financial activities have achieved a minimum of 40% female representation in senior management. However, the disparity between the top and bottom quartiles has been widening - a division evidently aligned with specific sectors. Building societies and UK banks stand at the forefront, while global investment banks and asset managers occupy the lower end of the spectrum.

For our GAAPweb audience, there’s an apparent divide in representation in the types of companies they work for. Male employees dominate the Big 4 Accountancy Firm sector, holding a 71% majority, with Large accountancy firms following suit with 68% of jobs conducted by men. The lead for women in senior positions, seems to be limited to SMEs. Female employees see parity in Head of Finance and Finance Director roles in SMEs, with an even 50% split. Yet, a mere 2% of women are represented in Finance Director roles in the Big 4 Accountancy Firm group, and 7% of women hold the title of CFO in a FTSE 500 company.

The issue infiltrates each sector, company type, and industry. Female-led industries, such as Fintech (52% women, £28,455 less), Construction (69% women, £17,000 less), and Consultancy & Business Services (66% women, £15,400 less), present progress in representation, yet retain discrepancies in pay.

Driving Change in Recruitment:

To drive change, Women in Finance has placed a greater emphasis on recruitment practices. Taking an active role in gender diverse recruitment will allow firms to adhere to the Charter’s principles of setting targets, establishing accountability frameworks, and accessing progress to drive momentum across their initiatives. 75% of firms are channelling efforts into a diverse recruitment drive, focusing on a range of practices:

Diverse Interview Panels:

One in six signatories have stated that they are addressing the diversity of their interview panelists, ensuring that under-represented groups are involved throughout the interview process.

Targeted Training:

Specific training for recruiting managers and resourcing teams is to be prioritised by one in eight firms. Equipping those within the recruitment process with the skills and incentives they need to deliver equal opportunities will be a mandatory practice.

Accountability Frameworks:

An accountability framework allows firms to evaluate the measures they need to take to close the gender pay gap. Having vetted members sit on interview panels helps to ensure that diversity and objectivity holds a prominent place in the decision-making process.

The Strategic Approach:

With one in seven signatories noting that they reviewed or are reviewing their approach to recruitment, it is reassuring to see that firms are taking an active role in monitoring the changes implemented to aid gender diversity.

External Recruitment Partners:

The use of external recruitment partners and job sites have been pushed by one in six signatories, to source diverse candidates and aid the overall target to level the gender pay gap. This practice combines well with a market mapping policy, to proactively identify and source female talent.

Building the pipeline of female talent within each individual organisation is an essential measure to working towards the closure of the gender pay gap. Evolving practice has become more granular with organisations focusing on tracking the impact of their programmes implemented to aid gender diversity.

More than a quarter of signatories discussed the programmes they have introduced to develop female talent, ranging from focusing on building networks to enhancing the understanding of an organization's culture and politics. Alongside this, 1 in 12 signatories have introduced programmes to encourage women back after a career break.

Hybrid Working:

Hybrid working has come to the forefront this year, with signatories demonstrating a significant shift in the ways in which they use data to monitor the actions undertaken to pursue targets and to understand their impact, particularly hybrid working. According to the charter, “post-pandemic, 91% of signatories are exploring some form of hybrid working, and more of them are on the lookout for potential negative impacts on women.”

68% of our salary survey respondents adopted a hybrid structure in 2023, compared to 21% last year. The question thus remains whether the positive benefits of hybrid working, such as a newfound ‘structured freedom’ for women, outweigh the negative ramifications.


 

To find out more about how GAAPweb can help you hire a gender diverse interview pool contact us on sales@gaapweb.com 0207 348 5010.

For further insights into gender equality in the finance profession - download our latest salary survey.

GAAPweb continues to champion gender equality in the finance profession through sharing insights from our annual Salary Surveys and working in line with the Women in Finance Charter.