Official figures show that male financial directors earn, on average, almost £30,000 a year more than their female counterparts. That is according to an analysis by specialist recruiter, Global Accounting Network, which attributes the phenomenon, in part, to an unnecessary focus on existing salary when negotiating remuneration as professionals climb the career ladder.
This significant disparity at senior level is despite a relatively narrow gender pay gap for accountants more generally. Data from the Office for National Statistics shows that at chartered and qualified accountant level – where the workforce is split equally in terms of gender – the pay gap between males and females sits at 5.1%. Men working in these roles enjoy an average annual salary of £37,250 compared to the £33,010 that women typically earn.
However, among financial managers and directors – where females account for 42% of the workforce – the pay gap widens to 31.6% – with women earning an average of £42,674 in comparison to the £71,986 salary of their male contemporaries. The difference between the two figures equates to £29,312 a year.
Commenting on the findings, Adrian O’Conner, Founding Director at Global Accounting Network, said:
“The depth and complexity of issues contributing to overarching gender pay gaps should not be underestimated. However, when women are being paid significantly less in the same or similar roles, employers must reflect on current practices to understand why.
“Females are statistically more likely to take career breaks to care for family. When these professionals return to work, the institutional practice of basing new job offers on incremental increases on their previous salary can prevent them from catching up as quickly as they perhaps should – if at all.
“‘How much do you currently earn?’ is a standard interview question, but the practice means that existing pay gaps can persist as individuals move roles. If employers continue to ask current salary the cycle will never be broken and even companies that are non-discriminatory can be unconsciously perpetuating the gap.
“We advise our clients that job offers should be made solely on how a candidate benchmarks and on what their value is to the business, not as a percentage increase on existing pay. Regardless of gender, as any professional steps up the career ladder, their salary should be directly aligned with their ability to do the job.”