Whatever the reasons for the gender gap in CEO pay, it needs to change

It’s the eternal pink and blue divide.

It’s the eternal pink and blue divide. The corporate gender pay gap in the UK and for that matter across the globe has been heavily debated and there are myriad opinions around why men get more hefty pay packages than women and, more importantly, why men hold most of the top jobs in the industry.

The divide has come into focus again with results of a new salary research by the Chartered Management Institute (CMI) revealing that men actually earn £141,500 more in bonuses than women doing the same role over the course of a working life.

According to the CMI research of 43,000 managers, male executives, on an average, get double the amount of bonus in comparison to women, with extra payments standing at £6,442 in 2012 compared with £3,029. Women directors' average bonus is £36,270, while men receive £63,700, and at more senior levels, the pay gap for both basic and bonuses increase, according to CMI.

There is no doubt that there are more male executives holding top jobs with fat salaries than there are women doing the same in the UK. Only last month a proposal by the Conservative Women's Forum, a group of female MPs investigating why too few women rise to the top of Britain's companies, said stats on the number of women firms employ at each level, the number of employees promoted by gender and the average pay gap at each rank, should be made public if "Britain is ever to get to the bottom of its "women's problem" in business".

However the problems aggravating the pay gap between the sexes are, at one level, rudimentary and age old. Societal biases and just a leak in the women talent pool are the real problems here, as they have been for decades.

A recent Harvard study of workplace ambitions showed fewer women aspire to top jobs than men. According to CMI, at junior levels, women actually earn £989 more than men on average and make up 64.3 per cent of the proportion of staff. But by middle management they fall behind both in terms of salary and representation, receiving £1,760 less than men and filling less than 44.3 per cent of the roles.

Childcare and family life – both of which women have been critisised for prioritising over their work lives – are basic realities that do exist and even may push the mentality that men will be more dedicated to the professional demands of a company in comparison to women who have a home to run. Also the maternity leave periods often become gaps in women’s career roadmaps. 

Things have gotten better over the years though. A Pew Research Center study released in June revealed that 23 per cent of women earn more than their husbands, up from 4 per cent who did in 1960. According to a survey carried out by Southampton University recently, the few female chief executives at FTSE 350 companies are paid on average £1.8m, compared to £1.3m for men, and the close links between performance and pay at public companies suggested that women bosses were delivering better results. The study also found that female chief executive pay had gone up by 9.3pc per year on average over the last five years, compared to 5.1 per cent for men.

Golablly, we have the likes of Indra Nooyi, Chairman and CEO, PepsiCo, Marissa Mayer, CEO, Yahoo, Ginni Rometty, President and CEO, IBM, Anne Sweeney, Co-Chair, Disney Media Networks, and President , Disney/ABC Television Group, Safra Catz, President and CFO, Oracle, Ursula Burns, Chairman and CEO, Xerox, to name some heavyweights who are turning the tide.

However the fact that when Beyonce sings "all the honeys makin’ money…throw your hands up at me" we can actually pick out names from a women-power-list of those who can wave back is the worrying bit. When it comes to men, that’s not a practical thought.

In the UK particularly, although women who run public companies may earn more than their male counterparts, they definitely represent a minority. Women only account for 5.6 per cent of executive directorships, despite the government target of 25 per cent. In fact Boardwatch UK recorded the first fall in the percentage of women on company boards, earlier in the year, since the figures were first complied in 1999.

As long as there are biases and "dirty old men" at share holder meetings telling the likes of Marissa Mayer that they are attractive instead of anything related to the job they do, or there are stereotypes that women will always prioritise family life over their jobs, women gaining positions of real power on the corporate ladder is going to be slow. The ladies need to be more proactive themselves about where their career trajectory is going, how their salaries and job descriptions compare to their male counterparts and they must speak up when it comes to getting a bonus or promotion if there is a valid case for it. They have to be the change they want to see. That maybe a cliché but there’s a reason why cliché’s are true.

On the other hand perceptions too need to change. A female or male boss is irrelevant when he or she is the best person to do the job and that’s how companies must approach their employees, alongside also actively working towards bridging a lopsided gender employment scale. Even after that, we may not end up with identical labour market outcomes for men and women. It will be of crucial importance then how the labour market rewards different types of work. 

Just recently, Bank of England Governor Mark Carney admitted to a “striking lack of top female economists” and pledged to create a pool of candidates for its rate-setting committee who will eventually become good enough to be the first female governor in the Bank’s 300-year history. He said the Bank has to “grow” top female economists all the way through the ranks. That attitude will go a long way in terms of awareness and equality. I’m with Carney.

I'm with Carney. Photograph: Getty Images

Meghna Mukerjee is a reporter at Retail Banker International

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Scottish Labour's defeat to the Tories confirms a political transformation

The defining divide is no longer between left and right but between unionist and nationalist.

It was Scotland where Labour's recovery was supposed to begin. Jeremy Corbyn's allies predicted that his brand of left-wing, anti-austerity politics would dent the SNP's hegemony. After becoming leader, Corbyn pledged that winning north of the border would be one of his greatest priorities. 

But in the first major elections of his leadership, it has proved to be Labour's greatest failure. A result that was long thought unthinkable has come to pass: the Conservatives have finished second (winning 31 seats). For the first time since the 1910 election, Labour has finished third (winning 24). Scottish Labour leader Kezia Dugdale stood on a left-wing platform, outflanking the SNP on tax (pledging to raise the top rate to 50p and increase the basic rate by 1p), promising to spend more on public services and opposing the renewal of Trident. But rather than advancing, the party merely retreated.

Its fate confirms how Scottish politics has been realigned. The defining divide is no longer between left and right but between unionist and nationalist. With the SNP as the only major pro-independence party, the Tories, led by the pugnacious Ruth Davidson, framed themselves as the pro-UK alternative - and prospered. In contrast, Dugdale refused to rule out supporting a second referendum and suggested that MPs and MSPs would be free to campaign for secession. The result was that Scottish Labour was left looking dangerously irrelevant. "Identity politics. Labour doesn't get it," a shadow minister told me. Its socialist pitch counted for little in a country that remains ideologically closer to England than thought. The SNP has lost its majority (denying it a mandate for a second referendum) - an outcome that the electoral system was always designed to make impossible. But its rule remains unthreatened. 

Corbyn's critics will seek to pin the baleful result on him. "We turned left and followed Jeremy's politics in Scotland, which far from solving our problems, pushed us into third," a senior opponent told me. But others will contend that a still more left-wing leader, such as Neil Findlay, is needed. Dugdale is personally supportive of Trident and was critical of Corbyn before his election. Should she be displaced, the party will be forced to elect its sixth leader in less than five years. But no one is so short-sighted as to believe that one person can revive the party's fortunes. Some Corbyn critics believe that a UK-wide recovery is a precondition of recovery north of the border. At this juncture, they say, SNP defectors would look anew at the party as they contemplate the role that Scottish MPs could play in a Westminster government. But under Corbyn, having become the first opposition to lose local election seats since 1985, it is yet further from power. 

In Scotland, the question now haunting Labour is not merely how it recovers - but whether it ever can. 

George Eaton is political editor of the New Statesman.