How executive pay has soared

Executives have enjoyed pay increases of nearly 5,000 per cent in the last 30 years.

Thanks to the High Pay Commission, no one can now deny that Britain has a problem with executive pay. The body's final report was published today and it contains some remarkable data. In the case of Barclays, for instance, top pay is now 75 times that of the average worker, compared to 14.5 in 1979 (see table below). In the last 30 years, the lead executive's pay in Barclays has risen by 4,889.4 per cent - from £87,323 to an extraordinary £4,365, 636, while average pay has risen from £6,474 to just £25,900. The commission argues persuasively that excessive pay at the top has increased inequality, damaged trust in business, distorted the market and created instability.

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So, to quote Lenin, what is to be done? The body makes 12 recommendations to tackle high pay, including employee representation on remuneration committees, publishing the top 10 executive pay packages outside the boardroom, forcing companies to publish a pay ratio between the highest paid executive and the company median, and establishing a new permanent body to monitor high pay.

The initial response from the government is encouraging. Vince Cable, who launched a consultation into the issue in September, said:

Many of the options we are consulting on are reflected in the High Pay Commission's final report and we welcome their contribution to this important debate. The government will announce next steps early next year. In the last decade we have seen extreme increases in top executive pay which appear to be completely unrelated to the performance of companies. They are therefore acting against the interests of shareholders and consumers.

There is widespread consensus, not just among the public but in the business community, that this is unacceptable and is undermining the credibility of our markets-based system.

What I'm working towards is responsible capitalism where rewards are properly aligned with performance.

You don't have to be a Cuban communist, as corporate headhunter Dr Heather McGregor absurdly claimed on the Today programme this morning, to believe this is a problem. Should the government fail to act, Britain will become an even more unequal society. As the shocking graph below shows, based on current trends, the top 0.1 per cent will take home 14 per cent of national income by 2035, a level of inequality not seen since Victorian times.

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We know from The Spirit Level that the most unequal countries do worse on almost every quality of life indicator. They suffer from higher levels of violence, mental illness, obesity and teenage pregnancy, and lower levels of trust, child well-being and happiness. If Britain is to avoid even greater social unrest, the government must call time on the era of runaway rewards.

George Eaton is political editor of the New Statesman.

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Harmful gender stereotypes in ads have real impact – so we're challenging them

The ASA must make sure future generations don't recoil at our commercials.

July’s been quite the month for gender in the news. From Jodie Whittaker’s casting in Doctor Who, to trains “so simple even women can drive them”, to how much the Beeb pays its female talent, gender issues have dominated. 

You might think it was an appropriate time for the Advertising Standards Authority (ASA) to launch our own contribution to the debate, Depictions, Perceptions and Harm: a report on gender stereotypes in advertising, the result of more than a year’s careful scrutiny of the evidence base.

Our report makes the case that, while most ads (and the businesses behind them) are getting it right when it comes to avoiding damaging gender stereotypes, the evidence suggests that some could do with reigning it in a little. Specifically, it argues that some ads can contribute to real world harms in the way they portray gender roles and characteristics.

We’re not talking here about ads that show a woman doing the cleaning or a man the DIY. It would be most odd if advertisers couldn’t depict a woman doing the family shop or a man mowing the lawn. Ads cannot be divorced from reality.

What we’re talking about is ads that go significantly further by, for example, suggesting through their content and context that it’s a mum’s sole duty to tidy up after her family, who’ve just trashed the house. Or that an activity or career is inappropriate for a girl because it’s the preserve of men. Or that boys are not “proper” boys if they’re not strong and stoical. Or that men are hopeless at simple parental or household tasks because they’re, well...men.

Advertising is only a small contributor to gender stereotyping, but a contributor it is. And there’s ever greater recognition of the harms that can result from gender stereotyping. Put simply, gender stereotypes can lead us to have a narrower sense of ourselves – how we can behave, who we can be, the opportunities we can take, the decisions we can make. And they can lead other people to have a narrower sense of us too. 

That can affect individuals, whatever their gender. It can affect the economy: we have a shortage of engineers in this country, in part, says the UK’s National Academy of Engineering, because many women don’t see it as a career for them. And it can affect our society as a whole.

Many businesses get this already. A few weeks ago, UN Women and Unilever announced the global launch of Unstereotype Alliance, with some of the world’s biggest companies, including Proctor & Gamble, Mars, Diageo, Facebook and Google signing up. Advertising agencies like JWT and UM have very recently published their own research, further shining the spotlight on gender stereotyping in advertising. 

At the ASA, we see our UK work as a complement to an increasingly global response to the issue. And we’re doing it with broad support from the UK advertising industry: the Committees of Advertising Practice (CAP) – the industry bodies which author the UK Advertising Codes that we administer – have been very closely involved in our work and will now flesh out the standards we need to help advertisers stay on the right side of the line.

Needless to say, our report has attracted a fair amount of comment. And commentators have made some interesting and important arguments. Take my “ads cannot be divorced from reality” point above. Clearly we – the UK advertising regulator - must take into account the way things are, but what should we do if, for example, an ad is reflecting a part of society as it is now, but that part is not fair and equal? 

The ad might simply be mirroring the way things are, but at a time when many people in our society, including through public policy and equality laws, are trying to mould it into something different. If we reign in the more extreme examples, are we being social engineers? Or are we simply taking a small step in redressing the imbalance in a society where the drip, drip, drip of gender stereotyping over many years has, itself, been social engineering. And social engineering which, ironically, has left us with too few engineers.

Read more: Why new rules on gender stereotyping in ads benefit men, too

The report gave news outlets a chance to run plenty of well-known ads from yesteryear. Fairy Liquid, Shake 'n' Vac and some real “even a woman can open it”-type horrors from decades ago. For some, that was an opportunity to make the point that ads really were sexist back then, but everything’s fine on the gender stereotyping front today. That argument shows a real lack of imagination. 

History has not stopped. If we’re looking back at ads of 50 years ago and marvelling at how we thought they were OK back then, despite knowing they were products of their time, won’t our children and grandchildren be doing exactly the same thing in 50 years’ time? What “norms” now will seem antiquated and unpleasant in the future? We think the evidence points to some portrayals of gender roles and characteristics being precisely such norms, excused by some today on the basis that that’s just the way it is.

Our report signals that change is coming. CAP will now work on the standards so we can pin down the rules and official guidance. We don’t want to catch advertisers out, so we and CAP will work hard to provide as much advice and training as we can, so they can get their ads right in the first place. And from next year, we at the ASA will make sure those standards are followed, taking care that our regulation is balanced and wholly respectful of the public’s desire to continue to see creative ads that are relevant, entertaining and informative. 

You won’t see a sea-change in the ads that appear, but we hope to smooth some of the rougher edges. This is a small but important step in making sure modern society is better represented in ads.

Guy Parker is CEO of the ASA