U.K. Investment Banks Pay Women 56% of What Male Colleagues Make
New data on the gender pay gap in British investment banking is due next week -- and the numbers so far aren’t looking good.
A sample of 10 large banks that have already reported ahead of an Oct. 5 deadline show an average 44.5% difference between male and female hourly wages as of April 2020, compared to 45.2% reported the previous year. That means women earned 56 pence for every pound that men earned when comparing their average hourly pay.
HSBC Bank Plc, the unit housing the lender’s U.K. investment banking operations, posted the largest divide at 54.4% -- an improvement of 0.7 percentage points on the previous year. While most of the 10 banks reported a smaller gap than in their last report, the progress in recent years hasn’t been swift.
Just 9% of those in top pay quartile at HSBC Bank Plc are women, making it the worst performer in the sample on this measure too. Not every bank has reported yet, after the U.K. government allowed firms to delay disclosures during the pandemic.
Gender pay gap reporting became mandatory in the U.K. in 2017 and has provided an insight into how far women’s earnings lag behind those of men. The latest numbers are mostly a snapshot from early 2020 and a blunt assessment across the whole workforce, though. The figures don’t measure the pay of men and women doing the same job, or adjust for other factors, such as experience or location. Put simply, it shows who holds the highest paying jobs. In most companies, men do.
Using median figures rather than the average -- an approach that strips out the impact of the highest earners -- does narrow the gender pay gap slightly. Under that approach, female workers across the 10 lenders face an hourly pay shortfall of 35% as of April 2020, down from 37% a year earlier.
Several banks that responded to requests for comment pointed out their efforts to diversify their senior ranks and rises in women joining entry-level programs. HSBC, for instance, runs an “accelerating into leadership” program to coach promising bankers from underrepresented groups.
“We’re caught in a compliance phase,” said Professor Grace Lordan, founder of the Inclusion Initiative at the London School of Economics and Political Science. “To reach the next stage we really need a culture change.”
None of the 10 banks Bloomberg News examined reported that women made up more than a fifth of their top-earning quartile.
The picture is complicated by some companies reporting separate data for subsidiaries. JPMorgan Securities Plc, for example, has 13.1% women in the top pay bracket, compared to 30.6% in JPMorgan Europe Limited.
The divide also improves somewhat when retail banking and other operations are included, such as at HSBC UK Bank, which reported a mean gap of 32.9% -- showing that parity nevertheless remains a long way off.
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