Six in 10 organisations recently surveyed by Korn Ferry say they are addressing gender pay issues, and another 17% say they plan to do so in the next year or so. But it’s not because of some altruistic streak.
The reason the best performing organisations are finally showing demonstrable commitment to diversity, rather than paying lip service to it and simply ticking boxes on pay equity compliance, is because it makes business sense to do that.
Championing women’s equality at work leads to:
- Better corporate performance and stability
Companies in the top quartile for gender diversity are 15 percent more likely to have financial returns above the median for their respective national industry.
Going from 0% to 30% women in corporate leadership is associated with a 15% increase in profitability. And companies with more diverse boards perform better during economic stress while female bosses make banks more stable.
- A more innovative working culture
Studies show that tapping into the full potential of men and women, foster creativity and innovation. An equal mix of gender creates ‘psychological safety’ – that’s when the members of a team feel that the team is safe for interpersonal risk-taking, sharing their ideas and viewpoints, challenging, and contributing.
- Helping to close the growing skills gap
The ageing population and growing need of a highly skilled workforce required to fill jobs in the digital economy are conspiring to create a skills gap. This will put even more upward pressure on pay for jobs for which there’s already a shortage of qualified candidates, such as roles in STEM (science, technology, engineering, and math) and leadership positions. Making the pool of suitable people bigger would ease some of the pressure and help cut the cost of filling these roles.
- Better connecting organisations to their customers
Women control about $18 trillion—of consumer spending globally. So, having gender-diverse boards is vital for staying on top of trends. In addition, consumers increasingly expect the companies they buy from to be both fair and transparent. So, making a clear and sustained effort to do the right thing (what Warren Buffett called “getting the other half in the game”) will improve the way consumers perceive brands.
Besides these many benefits to businesses, there’s an important positive social impact; a more equitable society and a healthier global economy. There is no surprise then that in many parts of the world, governments have forced the issue with new policies, pledges, targets, and rolled out programs to close the gender pay gap. In other places, private groups are taking the lead.
We have a compiled a collection of resources and the latest insights on this complex issue to help your organisation take bold steps to advance women and close the wage gap.
Gender Pay Is Having Its Day in the UK
High-profile discrepancies in the salaries and pensions of men and women highlight the complexity of the pay gap issue. https://www.kornferry.com/institute/uk-gender-pay
Equal Pay: Lessons from New Zealand
The small nation embarks on an ambitious goal to eliminate salary differences.
No Gap at the Top
There are still far fewer women than men leading giant corporations, but the women who are there are getting paid on equal, if not better, terms. Irv Becker, a Korn Ferry senior client partner and leader of the firm’s North American Executive Pay and Governance practice, spoke with both the Wall Street Journal and radio station KCBS recently about why women at the top of the corporate ladder have hit, and surpassed, pay parity.