Editor’s Note: Kara Alaimo, an assistant professor of public relations at Hofstra University, is the author of “Pitch, Tweet, or Engage on the Street: How to Practice Global Public Relations and Strategic Communication.” She was spokeswoman for international affairs in the Treasury Department during the Obama administration. Follow her on Twitter @karaalaimo. The opinions expressed in this commentary are solely those of the author.
Kara Alaimo: The UK forced the BBC to reveal average of male and female employees
US companies should be held to the same standard in order to ensure more equal pay, Alaimos writes
On Wednesday, the BBC revealed an ugly truth: women who work for the world’s premier public service broadcaster are paid a lot less than their male counterparts.
The difference in average earnings of men and women at the BBC is 10% – which is, however, lower than the United Kingdom’s average of 18%.
The company also published the earnings of all employees who earn more than the Prime Minister (over $195,400). This showed that just two of the organization’s 14 highest paid on-air presenters are women.
The BBC didn’t disclose such embarrassing data by choice – it was forced to do so against its wishes by the government. And next year, under a new law, all large British companies will be required to publish some information about gender and pay. Here in the United States, we should do the same; publicly traded companies should be required to publish data on their salaries by gender.
Why? Because American women make on average just 80% of the salaries of our male counterparts (the numbers are even more pronounced when compared along racial and ethnic lines). And according to the US Census Bureau, there’s been no significant progress on this gap since 2007. At the rate things have been improving, women will have to wait 42 years to earn the same salaries as men.
That’s way too long. Something dramatic needs to be done to get companies to treat women and men fairly.
But the number that really matters isn’t just the average salaries of men vs. women. It’s also the percentage of overall pay that goes to men vs. women.
For organizations like big Wall Street firms that employ many more men than women, that gender gap figure would be truly devastating. For example, Nori Gerardo Lietz – describing her research in the Harvard Business Review – wrote that just 17-23% of employees in private investment firms she studied in the United States and Europe are female – even though women make up 35-40% of business school graduates and say they have the same interest as men in careers in finance.
Another factor that enlarges the difference in overall pay is that, in organizations like the BBC, men are overrepresented in the most senior, highest paying jobs. Just 25.1% of executive and senior level officials and managers in S&P 500 companies are women, according to data from Catalyst and the EEOC.
Forcing companies to disclose their overall pay to men and women would put them under pressure to correct all three issues: the salary gap between men and women in the same jobs, the lack of female employees in some firms, and the lack of women at the top.
The BBC argues that it needs the flexibility to be able to pay its stars big bucks in order to effectively compete. To be fair, the publicly funded organization is up against commercial broadcasters.
But if all companies disclosed such data, then it would be harder for organizations to justify pay gaps by gender based upon vague, unsubstantiated claims about their competition.
It would also put companies in competition with one another to ensure more equal pay – no company wants to make headlines as a worst offender – and help them attract top talent.
Of course, such a law is unlikely to be championed by Donald Trump’s administration. During the President’s tenure, the pay gap between men and women who work in the White House has more than tripled, according to an analysis by the American Enterprise Institute. Though President Obama’s White House also had a pay gap, especially early on, he also took steps to require big companies to report salary data on race, gender, and ethnicity.
But even if lawmakers don’t champion such a rule, citizens and shareholders can demand such disclosures. We can tweet, sign petitions and introduce shareholder resolutions.
Companies are under more pressure than ever before to practice corporate social responsibility, and most major corporations publish reports about their impact on people and the planet. If we all started expecting that companies make such figures public, it would soon become standard business practice.
I’m willing to bet a few other standard business practices would change along with it.