Closing the Gender Pay Gap is Doing Good While Doing Well

More pressure is growing around the world to address the gender pay gap – not just its underlying unfairness, but also its debilitating effect on company competitiveness and community development.

Recently, Democratic Presidential candidate Kamala Harris proposed a plan to fine companies 1% of their profits for every 1% wage gap they allow to persist for work of equal value. While certainly bold for the United States, this isn’t necessarily the first attempt to lessen the gap.

In 2018, the U.K. began requiring employers with at least 250 employees to report gender wage disparities. The results highlighted huge pay gaps at high-profile companies, including Britain’s biggest bank, HSBC Holdings Plc, where women earned an average 59% less than men. The World Economic Forum has made gender pay an increasingly important global imperative.

Whether you agree that it is the government’s place to take up the gender pay mantle is perhaps a question of personal politics. I will bet, however, that the most competitive organizations of tomorrow will take it upon themselves to radically address this problem and alter their corporate cultures appropriately.

Why?

1)     You cannot solve tomorrow’s problems with a monolithic mindset. Do all of your customers, investors and other stakeholders all think alike? Do they consume and buy products in the same way? Is what they are looking for in a product the same? If you approach your business with only one perspective at the table, you will lose mindshare and credibility among consumers who are different than yourself. Also, did you know that women are the primary purchasers of one’s household?

2)     You won’t win the best talent in an ever competitive talent pool. Women make up more than half of the population. More women are earning advanced degrees. Do you think the best talent really wants to work for an organization that doesn’t value talent, fairness, and diversity? If you are the best in your field, why not work for a company that walks the walk?

3)     Government can mandate a change. But change must come from within. Whether laws forcing greater transparency with respect to equal pay come tomorrow, in 10 years, or never, there’s really only one way to change a culture – from within. Companies can choose to course correct after they are required by law to do so. I would argue if you wait this long, change will be vastly more difficult, and as transparency is required, you’ll be up against an employee and public relations nightmare. Why not evaluate your culture now, and build the trust in your employees, your customers, and your communities? You’ll be more innovative, nimble and profitable as a result.

It’s time to close the gender pay gap. For moral reasons - yes. But don’t forget the underlying business competitiveness and readiness argument. You can be both a steward for ethical behavior and reap a profit. It's simply good business to close the gap!

https://www.questback.com/resources/white-paper/the-role-of-culture-in-closing-the-gender-pay-gap/