WHAT IS THE GENDER PAY GAP?
- Gender pay gap and equal pay legislation deal with the disparity of pay women receive in the workplace
- Equal pay legislation deals with the pay differences between men and women within an organisation who carry out the same jobs, similar jobs or work of equal value
- The gender pay gap is a broader measure of the difference in the average earnings of men and women regardless of the nature of their work across an organisation. It is expressed as a percentage of men’s earnings: where there are more men at the senior level, the average male salary is higher than the average female salary
- Efficio analyses equal pay every six months and does not have unequal pay but we do have a gender pay gap
The mean gender pay gap in Efficio is 21%, which has been consistent over the last three years having improved from 24% in 2018; this pay gap reflects the high representation of men in senior positions. When we exclude our Vice President (equity partner) demographic from the calculation, the mean gender pay gap is 18%.
Our pay structures are linked to seniority and performance, meaning that bonuses have an equal impact on the pay gap as the base salary. Our internal pay analysis shows that we award bonuses to an equal proportion of women and men and pay the same level of bonus to men and women at the same grade. However, at senior levels, bonus accounts for a greater portion of total compensation, so the impact of having a smaller portion of women in our senior team is greater when we look at bonus pay: the mean bonus of female employees is 31% lower than that of their male colleagues (vs 28% in 2020).
Conversely, our median gender pay gap in both salary (12%) and bonus (24%) have improved, by four percentage points and eight percentage points respectively. At any employer, half of the staff will earn more than the median salary and half will earn less. As there are generally fewer women in higher paying positions than men, the gender pay gap as measured by mean earnings is often higher than for median earnings. As a result, we use the median as a key measure because it is a more representative when there is a skewed distribution of pay due to a minority of highly paid individuals: the median calculation is closest to the experience of the typical man and typical woman at Efficio.
The gap between the mid-point of the salary ranges between men and women is improving, primarily due to the small increase in the number of women we have in middle management (the upper middle quartile below).
The proportion of Efficio employees in each quartile pay band is:
Activities and Plans
As a growing business, hiring across all our jurisdictions, we have the opportunity to change the gender composition of our workforce more quickly than would a static business, but we face challenges. Management consulting, like many professional services, has a reputation for not retaining women through various phases of life, which leads to the gender pay gap we see across our industry in the UK and globally.
We have the additional challenge of recruiting talent with strong analytical and numerical skills to support the particular nature of the work we do for our clients; typically, successful candidates have a STEM degree background and women are still a significant minority in this field. To diversify the candidate profiles which are invited to interview, we now include talent with non-scientific/numeric degrees in our recruitment activities, if such candidates can demonstrate strong grades in maths or science at A-level.
We are committed to embedding diversity and inclusion in all aspects of our business; for ourselves, our colleagues and our clients. There is both a commercial and social imperative in doing so as we believe Efficio becomes a better place to work as we deliver on those commitments and becomes even more relevant to our client base.
In 2020 we established our Diversity & Inclusion Steerco, to develop and maintain company-wide focus on this important issue and to get input into initiatives to become a more gender-balanced organisation.
We have asked all leaders to commit to diversity and inclusion goals to highlight that this is a key business priority. One of our goals is to improve the balance of women and other diverse constituents in our Principal, Director and Vice President groups, where we are already making headway: in December 2019, women comprised 7% of our global leadership team; in March 2021, that figure is now 11%.
We have identified several collective priorities to continue to improve our gender balance:
- Attracting diverse talent: continually evolving our approach and opening recruitment channels to a wide range of universities, whilst ensuring that our hiring process is cognizant of diversity and inclusion
- Developing and retaining diverse talent – by intentionally embedding D&I into Efficio’s HR strategy and regional development plans
- Building D&I into our working practices – examining regional employee value propositions regarding relevant employee benefits, e.g. parental leave, and supporting our staffing team and project leadership to normalise working practices that support people at different stages of life and career
We will continue to engage with addressing the challenge of recruiting more women into our business and then enabling them to reach the most senior levels in the business. This is an ongoing commitment actively supported by the Board.