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Nov 7, 2012

Female execs in U.K. earning $674,225 less than men during their careers

Annual rewards one-half that of men: Report
    
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The average female executive in the United Kingdom suffers a lifetime earnings gap of £423,390 (C$674,225) when compared to a male worker with an identical career path.

With the current gap between male and female average pay at management level standing at £10,060 (C$16,020) per year, a woman and man entering executive roles aged 25 and working their way up the career ladder until retiring aged 60 would take home pre-tax totals of £1,092,940 (C$1,740,541) and £1,516,330 (C$2,414,802) respectively, according to analysis by the Chartered Management Institute (CMI).

The average male in an executive role earned a basic salary of £40,325 (C$64,218) over the 12 months to August 2012, compared to £30,265 (C$48,197) for a female in the same type of role. Although female junior executives earn marginally more than males at junior levels for the second year running, the gender pay gap remains substantial at the opposite end of the executive career ladder, with female directors earning an average basic salary of £127,257 (C$202,682) compared to £141,946 (C$ 226,086) for male directors

The gender pay gap extends to annual rewards, said CMI. At the 91 participating employers providing data on the payment of bonuses, women receive less than one-half what men are awarded in monetary terms. The average bonus for a male executive was £7,496 (C$11,939), compared to £3,726 (C$5,934) for a female executive.

This picture gets worse as women and men progress in their careers with 50 per cent of males at director level receiving bonuses compared to 36 per cent of females. At £65,000 (C$103,000), the average bonus paid to a male director was £7,000 (C$11,149) more than that awarded to a female director.

“A lot of businesses have been focused on getting more women on boards but we’ve still got a lot to do on equal pay and equal representation in top executive roles,” said Ann Francke, CMI chief executive. “Women make up almost three out of four at the bottom of the ladder but only one out of four at the top. This lack of a strong talent pipeline has to change, and fast. Allowing these types of gender inequalities to continue is precisely the kind of bad management that we need to stamp out. Companies are missing out on the full range of management potential at a time when we need to be doing everything we can to boost economic growth.”

More women than men fell foul of job cuts in the 12 month period between August 2011 and August 2012 — 4.3 per cent of female executives were made redundant, compared to 3.2 per cent of male executives. This difference grows as women move up the ranks — twice as many female directors were made redundant compared to male directors (7.4 per cent compared to 3.1 per cent).

“We need an immediate and collaborative approach to setting things straight,” said Francke. “The government should demand more transparency from companies on pay, naming and shaming organizations that are perpetuating inequality and celebrating those that achieve gender equality in the executive suite and the executive pay packet.”

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