Address alpha male culture in UK banking, says report

MPs have called for a change in the ‘alpha male culture’ at UK banks in a parliamentary report that cites the gender pay gap and hazy criteria for performance bonuses as key problems, according to the Guardian.

The investigation into women in finance found that an alpha male culture was one of the main reasons women gave for opting not to move into senior management at City firms. The culture was said to be particularly noticeable in negotiations over bonuses, where men are said to secure higher bonuses by making forceful demands.

The committee found that financial firms often feature a ‘pyramid’ structure where women are filtered out at each level of seniority, until the upper levels of management feature very few women at all.

The report comes two months after the deadline for UK companies with more than 250 employees to report on their gender pay gap, which highlighted significant gaps in UK banking. Barclays’ investment division pays men a median of 43.5% more than women, compared to the national average gap of 18.5%.

The Women in Finance report identified a 49% gender pay gap in UK bank bonuses and 38% at building societies. For every £100,000 in bonuses awarded to men, women receive just £56,500. The hourly pay gap in finance is 28%.

Treasury select committee chair Nicky Morgan said: “The benefits of gender diversity are highlighted in the report, including better financial performance, reduced groupthink and more open discussions.

“The next step must be for firms to set out how they will abolish their gender pay gap and support the progression of women. Firms should focus on changing the culture in financial services firms, which remains a deterrent for women, especially the bonus culture.”

The report calls on banks to tackle the gender pay gap through measures such as encouraging more men to take up flexible working, discouraging presenteeism and long hours culture, developing gender pay gap strategies and including partners and subsidiary companies in gender pay gap reporting. Recruitment and promotion policies should also be developed to prevent unconscious bias.

Gender pay gap among UK employees narrows to 9.6%

The pay gap between men and women in the UK is narrowing, official figures showed today.

Based on earnings in April 2012, the difference between hourly pay rates for men and women in full-time work decreased to 9.6%, from 10.5% in 2011. This continues a general downward trend in the pay gap in recent years, the Office for National Statistics (ONS) said.

Median gross weekly earnings for full-time employees in April 2012 amounted to GBP506, a rise of 1.5% from GBP498 in 2011. Dividing the pay figures on gender lines we can see that full-time earnings for men were GBP546, up 1.4%, compared with GBP449 for women, an increase of 1.9%.

Among part-time employees, women are better paid than men although their earnings are considerably below those of their full-time counterparts. Female part-time workers earned an average of GBP158 per week in April 2012 and men GBP146.

Brendan Barber, general secretary of the UK’s national trade union centre, the TUC, said that the pay gap between full-time and part-time workers is getting wider.

“This is terrible news for the millions of people who need to work part-time to balance work and caring responsibilities, or who simply can’t find full-time jobs,” he added.

As part of its annual survey of hours and earnings, the ONS also examined differences in pay by sector, pay scale and region.

There was little difference in the year-on-year rise in pay between the public and the private sector. Full-time public sector workers saw a rise in weekly earnings of 1.6% to GBP565 this year, while in the private sector the increase was 1.5% to GBP479. The ONS pointed out, however, that the difference in pay levels results from the fact that there are more low-paid jobs in the private sector and a larger proportion of graduate-level and professional occupations in the public sector.

Those at the top of the pay scales actually saw a decrease in their pay between 2011 and 2012. The hourly earnings excluding overtime of the highest paid full-time employees fell by 0.2%, while the lowest paid employees saw an increase of 2.3%.

Perhaps not surprisingly, median gross weekly earnings for full-time employees in April 2012 were highest in London, at GBP653. Employees in Wales had the lowest median earnings, at GBP453.