There has been lots of talk in recent years about diversity and inclusion. I’ll try to make this as interesting a read as possible but I thought I would look at the gender-pay gap in the insurance market and what has been discovered with some information released via The UK Gender Pay Reporting Regulations (UKGPRR)
Without a few facts I’m afraid I’ll be giving opinion over substance so bear with me.
Firstly, why is diversity important? McKinsey’s 2015 report ‘Diversity Matters’ claims that companies with better gender diversity were 15% more likely to show increased financial returns (for every 10% increase in gender diversity, EBIT rose by 3.5%). George Washington University also found that gender-diverse teams tend to be more productive.
So what does UKGPRR mean? It requires organisations with 250 or more employees to publish the following:
1) The difference between both the mean and median hourly rate of pay for male and female full-time employees
2) The difference between both the mean bonus pay and median bonus pay for male and female employees
3) The proportions of male and female employees who were awarded bonus pay
4) The proportions of male and female full-time employees in the lower, lower middle, upper middle and upper quartile pay bands.
ED Broking CEO Steve Hearn warned recently ‘The London insurance market will “disgrace itself” when companies have to release data on their gender pay gap next month’ – was he right?
Here is some, but not all of the data that was released from some insurance organisations earlier this year:
Zurich Insurance: Its mean gender pay gap for bonuses paid in the year to 5 April 2017 is 47.2%
AXA UK: Have a 17% median pay gap
Aviva (UK): A mean gender pay gap of 28.5% and a mean gender bonus gap of 57.2%
So, why is this?
Zurich attributes its gender pay gap to the fact that there are more men than women holding senior leadership roles, with fewer women progressing into higher paid technical or specialist positions, such as actuarial or underwriting jobs.
AXA also stated that the pay gap is a result of there being a greater proportion of men in more senior positions, as well as in roles that attract higher salaries, and not due to unequal pay for different genders working in the same levels and jobs.
Guess what? Aviva cited the unequal distribution of men and women throughout its business as the main reason. Specifically, the insurer has a higher proportion of women than men in more junior roles, as well as fewer women than men in senior and management roles.
So, it would appear that the issue is not one of women being paid less for the same role, more that there are fewer women in leadership / senior positions.
“I’m not proud of our gender pay gap figures,” said Aviva Group CRO Angela Darlington. “We’re already doing a lot to increase the number of women in our senior roles but it’s clearly not enough.”
I read something very interesting in a PwC report a few years back, it said that 13% of 8000 women it interviewed as part of it’s millennial survey wouldn’t want to work in insurance because of its image.
So, if gender pay gap is due to a lack of women at a senior level and the industry doesn’t have a fantastic image amongst a proportion of the future generations of female leaders, how can this change?
Lloyd’s of London has made strides to level the playing field for women working within the sector The organisation launched the Dive In festival of diversity and inclusion, for which it won the Diversity Champion prize at the Marketing Week Awards.
Tashi Lassalle, former head of marketing and communications at Lloyd’s of London, said: “Initiatives like Dive In send a message to people working in the market already that insurance is an industry where women are valued, supported and encouraged to develop their careers. It also helps to convince people who might be considering insurance as a career choice that it absolutely is a sector that is committed to diversity in all forms, not just gender.”
“As an industry, we just have to keep walking the talk and doing things differently as well as holding up examples of real people as role models. If they can be ambassadors for women because they have had positive support and mentoring experiences they can talk about that’s very powerful, especially for younger women who are choosing careers.”
So there you have it, things are improving. Companies are being held accountable, there are initiatives in the London market to increase diversity and people like myself are writing articles such as this.
There is clearly a long way to go and we all have a part to play. As a recruiter in the London insurance market, I will do my best to submit diversified shortlists to clients, I’ll sell the insurance market to young women and suggest it as a career path to them – there are many female role models in this market that can be highlighted – I’m sure you know some.
Who knows, that graduate that you suggest joins the market may go on to become the first female CEO of a particular insurer or brokerage, it may take time for that to happen but it would be progress, I guess that’s the point of UKGPRR – to recognise imbalance to drive change.
Thanks for reading, I’d be interested to know your thoughts.
SENIOR CONSULTANT – GOVERNANCE
T: +44 (0) 207 337 8824