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The average pay for female FTSE100 directors is £237k compared to £876k for men, the latest research by New Street Consulting Group shows.
Female FTSE100 directors are paid 73% less than male counterparts, according to a new study.
The study by New Street Consulting Group, a leadership and people solutions consultancy, finds that FTSE100 women directors’ average pay is £237,000 compared to £875,900 for male directors.
It is believed that the reason behind the pay gap is mainly due to the fact that 91% of female directors at FTSE100 companies hold non-executive roles rather than executive roles.
Claire Carter, Director at New Street Consulting Group, says: “Great progress has been made in bringing more women onto boards, but this research shows there is much more to do.” She adds: “Focusing solely on the percentages of directors that are women is not enough when trying to approach equality”.
The research also shows a gender pay gap between the different types of female and male directors. For instance, female non-executive directors at FTSE100 firms receive average pay of £104,800, compared to £170,400 for men, with the gender pay gap at executive level being even more noticeable – women executive directors receive on average £1.5m in comparison to £2.5m for male executive directors.
“Most businesses want to end the old boys club that exists at the top,” says Carter, adding that in order to do so it will be necessary to ensure “that women have more executive responsibilities and are trained and prepared properly for taking on that responsibility. Allocating them the right assignments and projects is essential to that process.”
Also, having females on board can lead to better future financial performance, including higher profits and stock market returns, said Carter. Having at least one woman on the board could increase stock prices by 10% in just one year, which can increase to 25% in five years for boards with a 33% representation of women, according to a report by the Financial Reporting Council (FRC).
Carter adds: “Ultimately the catalyst for change lies with the boards themselves. It will be a case of their examining whether there are any barriers that are preventing females from reaching the very top at their organisation, and if there’s anything they can do to help overcome these.”