The gender pay gap across European financial services boardrooms increased from 31% to 36% between 2019 and 2023 despite a rise in remuneration for women non-executive directors, according to the latest EY European Financial Services Boardroom Monitor.
EY compared the renumeration rates between North America and Europe, and found non-executive directors working for European financial firms have a larger gender pay gap than those working for North American firms.
It found the difference in the overall remuneration of men and women across Europe’s financial boardrooms within the four-year period increased. This comes despite a rise in the level of pay awarded to female non-executive directors over this period.
Between 2019 and 2023, the average remuneration for female non-exec board directors across European financial services firms increased by 12%, from $164,584 (£35,813) in 2019 to $184,477 (£152,229) in 2023. However, renumeration for male non-executives increased at a higher rate of 21% from $238,706 (£197,002) in 2019 to $287,994 (£237,680) in 2023.
Whilst, remuneration awarded to female non-executives directors across North American financial services firms increased by 13%, from $287,465 (£237,252) in 2019 to $324,250 (£267,534) in 2023. Pay awarded to male non-executive directors increased at a slower rate of 10%, from $309,392 (£255,275) in 2019 to $340,481 (£280,926) in 2023.
As a result, EY found the gender pay gap at European financial firms increased by 5%, where in 2023, female directors earned $64 (£53) for every $100 (£82) earned by male peers. Whilst, female directors working at North American financial firms earned $95 (£78) for every $100 (£82) earned by their male peers.
Specifically, EY found non-executive directors with sustainability expertise earn the highest. In 2023, non-executive directors in the sustainability field were paid an average of $301,098 (£247,805) compared to $234,702 (£193,160) for those without sustainability expertise. However, the gender pay gap remains: male board members are paid more, on average, than female peers with similar expertise.
Omar Ali, EY global financial services leader, said: “Compensation for non-executive directors across Europe’s financial boardrooms lags behind peers governing North American firms, creating a transatlantic pay gap.
“Competition for boardroom talent is high and increasingly global, and remuneration is becoming a more prominent focus. Gender representation across Europe’s financial boardrooms is moving slowly in the right direction, but it still remains far from equal.
“Data shows that whilst more men sit on committees and occupy more chair roles than women, the imbalance in pay between male and female peers is stark and concerning.
“Firms across North America lag European counterparts in appointing women to their boardrooms but, when they do, remuneration is on a much more level playing field. Addressing both imbalances will be increasingly key for firms across the global sector.”
