Gender Pay Gaps and the Future of Work: Transforming your Organisation from Compliance to Catalyst for Change
Many organisations I’ve spoken with since starting equidi see the gender pay gap as a government or societal issue. Often, they believe their role is confined to meeting government (i.e. Workplace Gender Equality Agency) reporting requirements with the bigger problem – for someone else to solve. These beliefs hold organisations back, resulting in a missed opportunity to improve the business from a financial and cultural perspective.
So, how do we transform beyond this, shift our mindset, and embed a culture of creating consistently fair and equitable workplaces?
This month, I wanted to focus our newsletter on laying down the foundations on the topic of gender pay gaps and pay equity – and how your business can go beyond compliance to being a catalyst for change.
Addressing the gender pay gap is fast becoming a hot topic and front of mind for boards and corporate leaders. It can no longer be seen as a discretionary agenda item that’s aspirational, thanks largely to the new legislation that will see the Workplace Gender Equality Agency (WGEA) make gender pay gaps transparent across Australia from early 2024.
Is this issue just about “equal pay for equal work”?
Before we dig deeper, let’s clarify the difference between the gender pay gap and pay equity. These concepts are critical in understanding "why" the gender pay gap is such an issue and the "how" organisations can act to address it.
According to the WGEA the gender pay gap is described as “a measure of how we value the contribution of men and women in the workforce. Expressed as a percentage or a dollar figure, it shows the difference between the average earnings of women and men."
To solve the gender pay gap, we must go beyond paying women and men equal pay for equal work. We need to deeply understand the root causes of the gender pay gap itself. Those causes range from systemic issues such as unconscious bias all the way up to discrimination (If you wish to read more on this, see the October GEM newsletter). Or they can exist because of a need for more maturity in integrated organisational practices such as unclear organisation design or job architecture, right up to immature remuneration frameworks and/or strategy.
What is the secret to reducing the gender pay gap?
In October, the WGEA and Bankwest Curtain Economics Centre (BCEC) released their annual Gender Equity Insights Report for 2023. The key insights illustrated below clearly show the positive impact for businesses that invest in practices to address the gender pay gap, and the results speak for themselves. Of the top 25% of companies that have accelerated progress in reducing their gender pay gaps, they've seen an average reduction in their gender pay gap of 5.2% over three years.
The common thread? They have recognised it’s a priority for the business - and have taken action. The reality of the future state with upcoming WGEA changes is that action will no longer be optional – it will be a legislative requirement for any business with over 500 employees to demonstrate action on the new Gender Equality Indicators (GEIs).
Working smarter - Leveraging technology to do the heavy lifting.
I speak to many organisations, and one of the biggest challenges when it comes to gender progress - is manual, time-consuming data manipulation, often to give just headline insights - let alone drill down to understand key drivers and insights. Usually, it's a once-a-year event, and by the time the team has gone through all the data integrity challenges - they've burnt all their 'gender work time' and with competing priorities - it's time to move on. Imagine if we shifted the paradigm and leveraged technology - so businesses could focus on taking action, crafting strategy, enhancing ways of working, and creating a culture that genuinely values equity.
So now to the million-dollar question, how can organisations accelerate their progress in closing their gender pay gaps?
💎 Data. Driven. Decisions. Your data should be front of mind – on all your people decisions!
Conducting a pay gap analysis should not be a one-off or annual event. It’s something that should be readily available, tracked, and measured. It should be front of mind and form part of your ways of working - if you intend to make sustainable change.
In most organisations, every day, there are people decisions to make that ultimately impact your gender pay gaps. So why only look at it on an ad-hoc basis? Leading organisations have practices in place that factor their data into these decisions at every point in time.
💎 Level up - understand your maturity when it comes to gender equity.
Every business is at a different point on their gender equity journey. The key is understanding your baseline to shape that into meaningful progress. The WGEA & BCEC defined three key domains within their four-tiered maturity model:
Policy & Strategy
Recruitment and Retention
Pay-Gap Strategies
Not surprisingly, businesses across the board were least mature on pay gap strategies, with progress more advanced on both other factors. If you want to understand your baseline maturity today – equidi has a free survey solution you can do to understand more about where you're currently at. This offer includes a short complementary briefing session to unpack the results.
💎 Transparency triumphs…
The WGEA and BCEC Report found that only 15% of gender equity metrics are reported to executive leaders and even less to the board, at only 10%. If you've ever heard the saying 'what gets measured, gets managed’, then it's no wonder progress to date has been slow – and this will continue to be the case - until we get the issue on the corporate agenda.
When I worked as a P&C Leader in Mining and Oil & Gas, safety incidents - big or small - were a standing item on everyone’s agenda. In fact, many mining organisations used safety as a KPI for bonuses and/or STI entitlements. Would eliminating the gender pay gap become an organisational priority if we saw a similar shift in levels of transparency, accountability and culture? Let's revisit next year when we start to see the impacts of transparency becoming a reality.
💜 Ready to take action? Reach out to learn more about how equidi can help you transform your approach to the gender equity and elevate your business. Together, we can create a future where gender equity is not just an obligation - but a strategic advantage.
💜 See the change, be the change - Join our movement today!
The Gender Equity Movement is a collective of individuals, businesses and advocates committed to creating equity and reducing the gender pay gap. Sign up as a business ally, or advocate and support the cause today!
