Greg Wright: Why it’s time to stop asking nicely for action over gender pay

Every right thinking business leader is appalled at the pitifully small numbers of women who reach senior roles. Unfortunately, nobody seems to have devised a speedy approach to resolving the problem. The solution may present itself, it seems, but not in our lifetime. Or in our great grandchildren’s lifetime.

In fact, The World Economic Forum predicts that it could take 217 years to close the gender pay gap. That’s not good enough. With Brexit dominating the headlines, there is a real danger that other issues will be simply kicked into the long grass.

Bold measures - such as fining bosses who fail to devise plans to tackle gender inequality and taking a hard line with companies who misuse non-disclosure agreements to silence women - must be taken seriously by policymakers.

In a Parliamentary debate about the gender pay gap, the Labour MP Stella Creasy MP said: “Time is up for asking nicely, because we have been asking nicely for some time for these issues around pay and progression to be dealt with, and the pace of change is glacial.

She added: “When our competitors in Germany, Belgium, France, and elsewhere across the EU—even in California, which is hardly a bastion of socialist public policy, are introducing quotas and recognising that pushing those quotas helps push the pipeline, the question for us is, “Why do we want to be left behind as a nation?”

“We are not doing anything fundamental to ensure that the talent that exists on the shop floor, that is currently underpaid, is being picked up and fast-tracked.”

Ms Creasy quoted official statistics which showed that 78 per cent of companies in this country that have more than 250 employees are paying the men they employ more than the women.

She added: “That is on average, so it is not just about individual men and women.

“That is a systematic undervaluing by those companies and organisations of the women who work for them, and of the possibilities that they could bring to their company or organisation.”

Unemployment among young women rose by 27,000 over the last quarter, according to the Young Women’s Trust. The charity’s research indicates that, in total, more than half a million young women are out of work and full-time education. In-work poverty remains rife, according to the charity’s CEO Dr Carole Easton.

“For many, an hour’s childcare still costs more than an hour’s wages,’’ she added.

But there are glimmers of light through the clouds. Growing numbers of MPs are supporting a new charter that would link executive pay to a company’s success in delivering gender equality.

The Association of Accounting Technicians said that most MPs have backed a recommendation to extend the Women in Finance Charter to cover all businesses in the UK.

Under the terms of the charter, firms must have at least one senior executive responsible and accountable for gender diversity and inclusion.

If you sign up for the charter, your firm must set internal targets for gender diversity in senior management positions and publish progress annually. Executive pay must be linked to delivery of these targets. Any chief executive who fails to meet these targets might find that their pay package at the end of the year will be not quite as substantial as they might have hoped.

The Association of Accounting Technicians believes that this charter, which has already been signed by 300 financial firms, should be extended to companies across all sectors.

But what of those who will never sign up? Surely, enforcement action is needed against them, although successive Governments have turned squeamish when faced with the prospect of introducing new regulations.

It’s time to stop ticking boxes and consider emulating Iceland, where firms that refuse to deliver action plans to tackle gender inequality can be hit with fines.

Sometimes, you have to speak softly and carry a big stick to secure real progress.