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April 11, 2018 at 10:08 AM
It’s no secret that there’s a pay gap in the finance industry. Female personal financial advisors, for example, earn about 59% of what their male counterparts do, according to the Bureau of Labor Statistics.
But data about pay gaps at specific firms is hard to come by, which is an issue not only for firms that want to attract and retain more female employees and promote more women into leadership positions but also for investors in those firms.
Companies with three or more women in executive leadership positions tend to have higher profits and stronger stock price growth than other firms, according to McKinsey & Co.
(Related: How to Attract More Female Advisors and Clients)
On Tuesday, in commemoration of International Equal Pay Day — the day that women’s average pay equals that for men in the previous year — Arjuna Capital, a boutique wealth management firm, in conjunction with Proxy Impact released the Gender Pay Scorecard (GPS) for 33 leading U.S. companies, including 13 financial firms.
The scorecard is based on corporate disclosure of gender pay gaps, which is not required in the U.S. but is required in the U.K. In the U.S., many firms report gender pay numbers adjusted for such variables as job category, seniority and geography even though they’re not required to do so. Firms operating in the U.K. must report the median pay and median bonuses for women compared to men.
Five of the 13 financial firms graded by the scorecard received a failing grade: Goldman Sachs, MetLife, Key Corp. Progressive Insurance and Discover Financial Services, primarily due to “lack of qualitative reporting, commitments toward equal pay and global coverage of employee pay,” according to the report.
(Related: Record Number of Women Became CFPs in 2017)
