More women in management drives decline in gender pay gap, but number of women on boards remains static

30/11/2023

Australia’s gender pay gap has dropped to an all-time low, but the number of women on boards remains static 

 

The good news is that this year’s Gender Equality Scorecard shows an annual pay difference of $26,393 remains between men and women in Australia, down by $1,322 on the previous year. The bad news is the number of women on boards remains static at 34% and one in four boards has no women. 

The Workplace Gender Equality Agency released its annual analysis of data earlier this week, based on the results of their nationwide employer census of 5,135 private sector employer reporting groups, covering 4,822,194 employee - the largest survey yet.  

The research shows only 19 per cent of Chairs are women and just over 13 per cent of businesses have targets in place to increase the representation of women on boards. A quarter of all boards are gender balanced (with at least 40 per cent men and women).

Claire Braund, Executive Director of Women on Boards, said "while the lack of progress on board composition may seem concerning in light of the small gains on the gender pay gap, it was important to remember that WGEA data also covers private (Pty Ltd) companies who by definition had fewer than 50 shareholders, smaller boards and were often founder led or governed."

"These companies are often less likely to be impacted by the shareholder or other stakeholder action to improve gender balance on their boards, however they are not immune to investor, customer and supplier requirements for improved governance standards and performance." Claire said.

"Leading private companies are well versed in the need to diversify their director pool, recruiting independing Chairs and NEDs to either the governing or advisory boards. However more clearly needs to be done if our private companies are to capitalise on 50% of the director talent pool."

Claire said that "while it was encouraging to see Australia’s total remuneration gender pay gap has dropped to a new low of 21.7 per cent, more work needs to be done to ensure young women are not leaving university knowing their starting salary will be automatically lower than the men in their course."

"The gender pay gap is complex and varies across sectors - so one thing I urge any young woman to do when they have a job offer is to take the time to go to WGEA website, look up the company that has offered them a job and track over time what their statistics on promotion of women to management and senior roles has been. Then make the decision."

*Data from WGEA 2022-23 Employer Census of private sector employers with 100 or more employees.

The gender pay gap decrease of 1.1 percentage points (from 22.8% in 2022) – is the second largest single year drop since WGEA started collecting employer data in 2014. It means on average, for every $1 men earn in Australia, women earn 78 cents.

The key driver of the lower gender pay gap is an increase in the proportion of women in management and in the upper pay quartiles. The proportion of women managers is now at 42% (up from 41% last year). 

WGEA Chief Executive Officer Mary Wooldridge said the results show that while slow, there is momentum for change in Australian workplaces.  

“Increased discussion and debate around gender equality, a tight labour market and impending legislative reform have helped drive action on workplace gender equality over the last year,” Ms Wooldridge said.  

“We see an increase in the proportion of women in management and at the upper pay quartiles, and we also see the proportion of women being promoted and appointed at manager level is higher than the proportion of women managers overall. As this trend continues, we can expect to see the gender pay gap continue to fall.

“This is promising as it signals that employers are increasingly prioritising gender equality as a core business measure and taking action to tackle workforce composition at the manager level.

“However, what we are seeing is that women working in full-time roles have opportunities to progress into higher-paying management roles and contribute to reducing the gender pay gap, but deviations from the norm are not being supported in the same way. 

*Data from WGEA 2022-23 Employer Census of private sector businesses with 100 or more employees.


“The management opportunities for part-time employees are negligible; the number of men taking paid primary carer parental leave has barely shifted; and the number of women in CEO roles and on boards has stagnated. 

“If we want real change, we need employers to take bold action. We need employers to look across the drivers of gender inequality and be imaginative in their solutions. 

“Publishing gender pay gaps requires employers to understand their unique challenges, develop a purpose-built approach to gender equality and then take intentional and sustained action.

“This Scorecard is a starting point for employers to assess their performance on the national scale and relative to their industry peers and identify where there is room for improvement.”

*Data from WGEA 2022-23 Employer Census of private sector businesses with 100 or more employees.
 

THE FINDINGS: Results from WGEA’s 2023 Gender Equality Scorecard

In 2023, employers made strong progress in the following key areas:

  • Gender Pay Gap: The average total remuneration gender pay gap decreased by 1.1 percentage points.
  • Workforce composition: The proportion of employees working in non-highly gender segregated industries reached 50% for the first time. 
  • Flexible work: 84% of employers have a flexible work policy and for the first time more than 50% also hold leaders to account for improving flexibility.
  • Parental leave policies: 63% offer some form of employer-funded paid parental leave. Of those employers, 33% offer it equally to women and men without using labels that define a carer’s role in the family unit as ‘primary’ or ‘secondary’ (up 9pp from 2022) and 86% pay superannuation on that leave (up 3pp).

More marginal improvements were made on:

  • Gender pay gap analysis: 70% employers have a policy or strategy to achieve equal remuneration, but only 55% conducted an analysis to understand what is driving their gender pay gaps. 
  • Uptake of parental leave: Women still account for the majority of primary carer’s leave taken and men account for the majority of secondary carer’s leave taken. The proportion of men who make up all paid primary carer’s leave taken increased just 0.6pp to 14%.
  • Empowering a workplace culture that promotes flexible work: While most employers now have a flexible work policy, only 43% provide managers with specific training on flexible work and the proportion offering team training has dropped to 35%.

Further attention is required for: 

  • Women's representation on boards: The proportion of women members on boards stayed the same as the previous year at 34%.
  • Flexibility in management: While 57% of women work part-time or casually, just 7% of all manager roles are part-time.
  • Industry segregation: Compared to male-dominated industries, female-dominated industries are three times less likely to analyse their payroll for gender pay gaps and take action as a result.
  • Consultation: 47% of employers reported they consult employees on gender equality, only 3 in 10 employers have a formal policy or strategy to do so. This figure has not changed from 2021-22.
For more details visit the WGEA Data Explorer
 
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